The New Jersey Employment Law Firm Blog

March 29, 2018

Supreme Court Rules that Dodd-Frank Whistleblower Protections Do Not Apply to Internal Reporting

Enforcement of a wide range of laws and regulations depends on reporting by people with knowledge of possible violations, often known as “whistleblowers.” In cases involving suspected wrongdoing by an employer, many potential whistleblowers may hesitate to speak out, for fear of losing their jobs. In New Jersey, employment statutes protect whistleblowers against retaliation by their employers. The U.S. Supreme Court recently ruled on a dispute over the whistleblower protections in the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”). It held that, unlike many other whistleblower protection laws, Dodd-Frank protects people who report their concerns to the government, but not those who only report internally. Digital Realty Trust, Inc. v. Somers, 583 U.S. ___ (2018).

New Jersey whistleblowers may report their concerns to government regulators or to internal control officers. The New Jersey Conscientious Employee Protection Act (CEPA) protects public and private employees who disclose suspected legal violations, or who refuse to take part in acts that they reasonably believe are illegal or unethical. This includes disclosures made “to a supervisor or to a public body.” N.J. Rev. Stat. § 34:19-3(a). The language of Dodd-Frank, however, is not as clear on this issue.

Congress passed Dodd-Frank as a response to the financial crisis of 2008. The statute defines “whistleblower” as one or more individuals who report alleged violations of securities laws or regulations “to the Commission, in a manner established, by rule or regulation, by the Commission.” 15 U.S.C. § 78u-6(a)(6). The term “Commission” is defined elsewhere in the same chapter as the Securities and Exchange Commission (SEC), with an exception when “the context otherwise requires” a different interpretation. Id. at § 78c(a)(15). The question for the Supreme Court was whether Dodd-Frank’s whistleblower protections apply to someone who makes a report to someone other than the SEC.

March 23, 2018

NLRB Reverses ALJ Ruling in Sex Discrimination Case

by Resnick Law Group, P.C.

The National Labor Relations Act (NLRA) regulates numerous interactions related to to labor organizing. It allows employees to assert New Jersey sex discrimination claims against both employers and unions for unfair labor practices. Labor unions’ obligations under the NLRA include a duty of fair representation. A recent decision by the National Labor Relations Board (NLRB) addressed an employee’s claim that a labor union breached this duty by discriminating against her on the basis of sex. The ruling harshly criticized the administrative law judge (ALJ) who ruled in the union’s favor. The NLRB vacated the ALJ’s ruling, finding that he “erred by relying in part on improper bases in making his credibility determinations.” International Longshoremen’s Association, Local 28 (Ceres Gulf Inc.) (“ILA”), 366 NLRB No. 20 at 1 (Feb. 20, 2018).

Labor organizations commit an unfair labor practice when they “restrain or coerce employees in the exercise of the rights guaranteed” by the NLRA. 29 U.S.C. § 158(b)(1)(A). Courts have identified specific ways that labor unions might unlawfully interfere with employees’ NLRA rights. The U.S. Supreme Court has held that a union has a duty “to represent nonunion or minority union members…without hostile discrimination, fairly, impartially, and in good faith.” Steele v. Louisville & N. R. Co., 323 U.S. 192, 204 (1944). A union violates the duty of fair representation “when it acts in a manner that is ‘arbitrary, discriminatory, or in bad faith.’” Vaca v. Sipes, 386 U.S. 171, 207 (1967). The NLRB views a breach of the duty of fair representation as an unfair labor practice.

The charging party in ILA has been a member of the union since 2001, usually working as a truck driver. According to the ALJ’s ruling, she began receiving union work referrals again in 2015 after an eight-year “union employment break.” ILA at 2. She alleges that she asked the union’s training coordinator to put her in training classes offered by the union several times during 2016, but he refused all of her requests. She further alleges that the coordinator sexually harassed her “when she periodically stopped by [his] office to request training.” Id. at 3. She allegedly made 36 requests for training, and she experienced sexual harassment while making 10 of those requests. She filed a complaint with the NLRB, alleging breach of the duty of fair representation through sex discrimination. She claimed that the coordinator denied her training opportunities because of her sex, and also because she refused his advances.

March 15, 2018

ADA Prohibits Discrimination by New Jersey Employers Because of Disability and Requires Them to Make Reasonable Accommodations

by Resnick Law Group, P.C.

Federal and state laws in New Jersey protect the rights of people with disabilities to have fair access to employment and to accommodations in the workplace that allow them to do their jobs. The Americans with Disabilities Act (ADA) of 1990 prohibits discrimination on the basis of a disability and requires employers to make reasonable accommodations for workers who are dealing with a wide range of disabilities. Since the ADA is a federal statute with nationwide reach, lawsuits and court rulings in other states can potentially affect New Jersey disability discrimination laws. Two recent ADA lawsuits illustrate how the statute can help New Jersey workers. One case involves an alleged refusal to hire an applicant because of their participation in an addiction recovery program. Equal Emp’t Opportunity Comm’n v. Volvo Group N. Am., LLC, No. 1:17-cv-02889, consent dec. (D. Md., Jan. 12, 2018). The other involves an alleged failure to engage in ADA-required processes regarding a request for an accommodation. McClain v. Tenax Corp., No. 1:17-cv-00049, order (S.D. Ala., Jan. 12, 2018).

The ADA’s definition of “disability” includes both “physical [and] mental impairment[s]” that are severe enough to “substantially limit[] one or more major life activities.” 42 U.S.C. § 12102(1)(A). It includes both “actual or perceived” impairments, meaning that a person who does not have a disability may still fall within the ADA’s protection if others think that they do. Id. at § 12102(3). The statute prohibits discrimination because of disability. This includes failing to make reasonable accommodations for an employee and refusing to hire an applicant in order to avoid making such accommodations. An employer does not have to make a requested accommodation if it can show that doing so would “impose an undue hardship” on its business. Id. at § 12112(b)(5)(A).

The Equal Employment Opportunity Commission filed the Volvo lawsuit on behalf of a job applicant claiming disability discrimination. The defendant allegedly rescinded a conditional offer of employment in early 2015, after learning that the applicant was undergoing addiction treatment. While the use of illegal drugs is not considered a disability under the ADA, “participating in a supervised rehabilitation program” while refraining from illegal drug use is. Id. at § 12114. According to the EEOC’s complaint, the applicant ceased the use of illegal drugs and began participation in a supervised treatment program in 2010. The treatment included the use of suboxone, which the applicant reportedly disclosed to the defendant. This allegedly led to the revocation of the offer. The parties reached a settlement in January 2018.

March 9, 2018

New Law Will Require Dialogue Between New York City Employers and Employees Regarding Reasonable Accommodations

by Resnick Law Group, P.C.

Federal and state laws protect New Jersey employees against discrimination on the basis of disability and other factors. The federal Americans with Disabilities Act (ADA) of 1990 prohibits discrimination and requires employers to provide “reasonable accommodations” for employees with disabilities. One area of ongoing dispute in employment law involves whether employers must provide reasonable accommodations to employees who are pregnant or have recently given birth. The ADA does not specifically mention pregnancy or related conditions. The New Jersey Law Against Discrimination (NJLAD), however, specifically requires employers to make reasonable accommodations available in cases of disability, pregnancy, and religious practices. The “reasonableness” of a particular accommodation can be a subject of dispute under both New Jersey disability discrimination laws and federal disability discrimination laws. A new law in New York City, which will take effect in October 2018, will require employers to engage in “cooperative dialogue” with employees who are requesting an accommodation for multiple possible situations. Int. No. 804-2015-A (NYC, Jan. 19, 2018).

Title VII of the Civil Rights Act of 1964 prohibits discrimination on the basis of religion, sex, and other factors, with “on the basis of sex” defined to include pregnancy. 42 U.S.C. §§ 2000e(k), 2000e-2(a)(1). The statute does not address accommodations for religious observances or the various needs associated with pregnancy and childbirth. The ADA includes a failure to provide reasonable accommodations within its list of discriminatory practices, with an exception if the accommodation “would impose an undue hardship on the operation of the business.” Id. at § 12112(b)(5)(A). It defines “disability” to include a range of “physical or mental impairment[s].” Id. at § 12102(1).

The NJLAD prohibits discrimination in employment on the basis of disability, religion, sex, pregnancy, and multiple other factors. N.J. Rev. Stat. § 10:5-12(a). The definition of “disability” is similar to that of the ADA and includes various conditions “caused by bodily injury, birth defect or illness.” Id. at § 10:5-5(q). An employer violates the NJLAD by denying employment to “an otherwise qualified person” because of a disability, unless the employer can “clearly show[]” that a person’s particular disability “would prevent such person from performing a particular job.” Id. at § 10:5-29.1.

March 2, 2018

New York City Lawsuit Alleges Race Discrimination in Violation of Federal Employment Law

by Resnick Law Group, P.C.

In New York City and New Jersey, employment laws prohibit discrimination on the basis of race and multiple other factors. Race discrimination in employment remains a serious problem all over the country, despite advances in the past 50 years. Some organizations, which were once quite open about their willingness to discriminate on the basis of race, still retain elements of that culture to this day. A putative class action filed late last year in a Manhattan federal court alleges that the Fire Department of New York (FDNY) has a long history of discrimination against African American employees and job applicants. Richardson, et al. v. City of New York, No. 1:17-cv-09447, complaint (S.D.N.Y., Dec. 1, 2017).

The New York City Human Rights Law (NYCHRL) prohibits employers from discriminating against employees and job applicants “because of the actual or perceived…race…of any person.” N.Y.C. Admin. Code § 8-107(1)(a). This provision is similar to those found in federal law and in state laws all over the country, including New Jersey race discrimination laws. The federal Civil Rights Act of 1991 protects the right to “make and enforce contracts” on equal terms, regardless of race, which includes employment contracts. 42 U.S.C. § 1981. A government employer, such as a city, state, or federal agency, that engages in employment discrimination on the basis of race may also be liable for civil rights violations under 42 U.S.C. § 1983.

The Richardson complaint describes a history of race discrimination in the FDNY, claiming that only “token integration” started in the 1960s. Richardson, complaint at 1. It notes two prior class actions alleging race discrimination against the FDNY in the hiring of firefighters. The first involved discrimination against African American and Hispanic firefighter applicants. Vulcan Society of New York City Fire Dep’t, Inc. v. Civil Serv. Comm’n, 490 F.2d 387 (2d Cir. 1973). The injunction issued by the court expired in 1977, and the city allegedly resumed discriminatory hiring practices for firefighters. The U.S. Department of Justice eventually filed suit, resulting in a ruling “that the FDNY’s hiring procedures discriminate against black applicants.” United States v. City of New York, 683 F.Supp.2d 225, 250-51 (E.D.N.Y 2010).

February 23, 2018

U.S. Department of Labor Issues New Rules Regarding When FLSA Covers Interns in New Jersey

by Resnick Law Group, P.C.

Internships often allow students to gain “real world” experience before entering the job market, but they have been a subject of controversy in the area of employment law. New Jersey labor law provides a statutory test for determining when an individual may be considered an intern, who is not necessarily protected by state wage and hour laws, and when they are an employee who should receive a paycheck. N.J.A.C. § 12:56-2.1. The federal Fair Labor Standards Act (FLSA) does not expressly define the difference between an intern and an employee, so the job of interpreting the statute goes to the Wage and Hour Division (WHD) of the U.S. Department of Labor. In January 2018, the WHD issued Field Assistance Bulletin No. 2018-2, which sets forth a new test for determining, in claims involving federal law, when an intern is actually an employee.

The FLSA governs the payment of wages to employees and the hours they may be expected to work, including provisions for minimum wage and overtime compensation. It defines an “employee” as “any individual employed by an employer.” 29 U.S.C. § 203(e)(1). The statute’s equally unhelpful definition of “employ” is “to suffer or permit to work.” Id. at § 203(g). It does not provide a definition for “intern” or “internship.” The commonly accepted definition of an internship is a temporary position that allows a student to gain experience in a particular field. The actual job description of an internship varies widely from one industry and one company to another. Interns in one company might spend much of their days getting coffee and running other errands, while interns in another company might gain hands-on experience in the profession of their dreams. Internships are often unpaid, based on the rationale that interns gain experience and connections that will help them start their careers.

The WHD established a six-part test for determining whether an individual is an employee under the FLSA in 2010 in a document entitled Fact Sheet No. 71. While the WHD has since updated that sheet on its website to reflect the new test, some court decisions evaluating the old test include its original text. The test considered whether the internship (1) was similar to instruction the intern would receive at school, (2) primarily benefited the intern rather than the employer, (3) did not displace existing workers, (4) provided “no immediate advantage” to the employer from the intern’s activities, (5) included no promise of a permanent job, and (6) involved an understanding between both parties that no wages were to be paid. Glatt v. Fox Searchlight Pictures, Inc., 811 F.3d 528, 534-35 (2d Cir. 2016). An intern is not an employee if all six questions are answered in the affirmative.

February 9, 2018

Federal Law Restricts Employers’ Ability to Enact Mass Layoffs in New Jersey and Nationwide

by Resnick Law Group, P.C.

The National Labor Relations Act (NLRA) enables workers to organize themselves for the purpose of collective bargaining with their employers. A current dispute between a major telecommunications company and its employees’ union alleges that the company is planning mass layoffs, in violation of the collective bargaining agreement (CBA) between the parties, and with the alleged intent of “diminish[ing] the Union’s bargaining strength.” Commc’ns Workers of Am. (CWA) v. AT&T Southwest, No. 1:17-cv-01221, complaint at 6 (W.D. Tex., Dec. 30, 2017). The union also filed a charge with the National Labor Relations Board (NLRB). AT&T Southwest, No. 16-CA-212398, charge (NLRB, Dec. 29, 2017). The case grew out of assertions made by prominent telecommunications companies regarding recent political issues, including recent tax cuts and changes to federal “net neutrality” rules. While the defendant employer claims the layoffs are due to a lack of work, the plaintiff asserts that the telecommunications business is booming. The issues raised by the lawsuit are likely to affect New Jersey labor rights as well.

Under the NLRA, employers may not interfere with workers’ efforts to organize, nor may they discriminate or retaliate against employees who engage in protected activity. The law also requires employers to collectively bargain with representatives chosen by the employees in accordance with its provisions. Once an employer and the employees’ representatives have entered into a CBA, it is binding on both parties. The NLRA allows claims to enforce CBA provisions and to collect damages for breaches. It also allows recovery of damages for various unfair labor practices described in § 8 of the statute, 29 U.S.C. § 158.

The plaintiff in CWA describes itself in its complaint as a labor union authorized to bring suit on behalf of the defendant’s employees under § 301 of the Labor-Management Relations Act of 1947. 29 U.S.C. § 185. The parties entered into the current CBA in April 2017. According to the complaint, a representative of the defendant’s labor relations department informed the plaintiff in December 2017 of the defendant’s intention to lay off 152 individuals employed as “Premises Technicians” (PTs) in at least four states. CWA, complaint at 4. The defendant’s representative cited “a reduction in workload” as the reason. Id.

February 2, 2018

NLRB Reverses 2016 Decision, Gives ALJs Greater Authority to Force Settlements in New Jersey Labor Disputes

by Resnick Law Group, P.C.

The National Labor Relations Board (NLRB) is the federal government agency responsible for enforcing the statute dealing with labor organizing and unfair labor practices. It consists of a five-member board and a General Counsel (GC), all of whom are appointed by the President and confirmed by the Senate. Complaints of labor law violations are first heard by an administrative law judge (ALJ). The board hears appeals of ALJ decisions, with the GC acting as prosecutor. The Senate recently confirmed two new NLRB appointees, giving Republicans a 3-2 majority for the first time in years. A decision issued by the NLRB in December 2017 seems to support claims that the new board will take a much more “pro-business” approach. The decision in UPMC, 365 NLRB No. 153 (2017), reverses a 2016 ruling that dealt with the NLRB’s authority to impose an employer’s settlement offer over the objections of both the charging party and the GC.

The National Labor Relations Act (NLRA) protects workers’ rights to engage in activities related to organizing for the purpose of collective bargaining. Workers alleging unfair labor practices and other violations of the NLRA may file a complaint with the NLRB. As with many administrative proceedings, the case first goes before an ALJ, who may conduct a trial and issue a ruling. A party can then appeal the ALJ’s ruling to the board. Prior to 2016, ALJs had considerable discretion regarding the disposition of cases. This was a key issue in the UPMC case.

A 2016 decision from the NLRB, U.S. Postal Service, 364 NLRB No. 116, effectively ended an earlier practice that allowed ALJs to impose a settlement offered by a respondent, without the charging party’s or GC’s agreement, if the ALJ determined that the settlement offer was reasonable. The NLRB first allowed this in Electronic Workers IUE Local 201 (General Electric Co.), 188 NLRB 855 (1971), when an ALJ approved a settlement offer as though it were a consent order. The ALJ found that “further hearing herein…could not result in any changes in the proposed Consent Order and Notice,” and the proposed settlement “would be more favorable to the General Counsel and Charging Party” despite their lack of consent. Id. at 857.

February 1, 2018

While New Jersey Employment Law Prohibits Discrimination Based on Sexual Orientation, U.S. Supreme Court Denies Petition to Review Extent of Federal Law

by Resnick Law Group, P.C.

The New Jersey Law Against Discrimination (NJLAD) is among the most expansive anti-discrimination statutes in the country, protecting employees from discrimination on the basis of multiple factors, including sexual orientation. Title VII of the federal Civil Rights Act of 1964 has far fewer expressly protected categories. Some federal courts have ruled in favor of plaintiffs claiming sexual orientation discrimination under Title VII, finding that the statute’s prohibition on sex discrimination encompasses sexual orientation as well. Other courts have ruled that sexual orientation discrimination is not discrimination on the basis of sex within Title VII’s meaning. The U.S. Supreme Court rejected a petition for certiorari in late 2017 that raised this question, Evans v. Georgia Regional Hospital. Since a conflict exists among lower court rulings on this issue, it is likely that the Supreme Court will accept a case at some point in the future.

The NJLAD states that an employer commits an unlawful employment practice by discriminating on the basis of “affectional or sexual orientation.” N.J. Rev. Stat. § 10:5-12(a). Title VII only mentions five factors: “race, color, religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a)(1). The U.S. Supreme Court has clarified the legal meaning of “sex” under Title VII in several rulings. This includes recognition of sexual harassment and “sex stereotyping” as forms of unlawful sex discrimination.

Many Title VII lawsuits alleging sexual orientation discrimination have cited the “sex stereotyping” ruling, which held that “assuming or insisting that [employees] matched the stereotype associated with their [sex]” could be evidence of sex discrimination. Price Waterhouse v. Hopkins, 490 U.S. 228, 251 (1989). Another commonly cited decision ruled in favor of a male plaintiff alleging sexual harassment by male co-workers, reportedly based on their negative perceptions of the plaintiff’s sexual orientation. The court held that harassment does not need to “be motivated by sexual desire” to constitute sexual harassment, and therefore sex discrimination, under Title VII. Oncale v. Sundowner Offshore Services, 523 U.S. 75, 80 (1998).

January 31, 2018

Employment Law Prohibiting Discrimination Based on Salary History Takes Effect in New York City, Gains Ground in New Jersey

by Resnick Law Group, P.C.

New Jersey prohibits employers from discriminating against employees and job applicants on the basis of multiple factors established by federal and state laws, and by municipal laws in some places. The New Jersey Law Against Discrimination (NJLAD) offers a broader range of protections than its federal counterpart, Title VII of the Civil Rights Act of 1964. Across the Hudson River, the New York City Human Rights Law (NYCHRL) offers even greater protections, but New Jersey is catching up in many ways. A law that recently took effect in New York City prohibits employers from asking job applicants about their salary history, and from making certain employment decisions on the basis of such information. Similar laws have recently taken effect in California, Massachusetts, and Oregon. The New Jersey Legislature also passed a similar law in 2017, but the governor vetoed it. Despite this setback, the circumstances of the New Jersey discrimination bill’s passage offer hope for a future legislative session.

The purpose of employment anti-discrimination law is to protect groups of people who might be vulnerable to unfair practices by employers because of historical patterns of inequality or current negative and inaccurate stereotypes. Both state and federal laws in New Jersey prohibit discrimination in employment on the basis of race, religion, color, national origin, or sex. N.J. Rev. Stat. § 10:5-12(a), 42 U.S.C. § 2000e-2(a)(1). The NJLAD includes additional protected categories like age and disability that may be found in other federal statutes. See, e.g. 29 U.S.C. § 623, 42 U.S.C. § 12112. In other areas, such as marital or civil union status, sexual orientation, and gender identity, the NJLAD goes beyond any protection expressly provided under federal law.

Laws at the state and federal levels generally require employers to pay employees the same wage for performing the same job, although much litigation has occurred over the question of determining the similarity of people’s jobs. The new law in New York City addresses discrimination based on a person’s salary history. An employer that asks an applicant about salary history may decide to hire a person solely because they have the lowest prior salary of all of the applicants, and then they might try to pay that person less than their coworkers. The recent amendment to the NYCHRL, which took effect on October 31, 2017, makes it an unlawful employment practice to inquire about salary history during the job application process, or to base a new hire’s salary and other terms of employment on their past wages. See N.Y.C. Admin. Code § 8-107(25).