Oregon Interns Get Harrassment/Discrimination Protection

June 7, 2013 by Leave a Comment

InternsUnpaid interns are especially vulnerable to predatory behavior in the workplace because they are young and inexperienced.

However, many courts have ruled that unpaid interns are not protected by state and federal harassment and discrimination laws.

This week the Oregon legislature agreed to extend workplace protections against harassment and discrimination to unpaid interns.  These protections formerly were reserved only for employees.

The Oregon Senate unanimously passed HB 2669, sending it to Gov. John Kitzhaber for signature. The Oregon house unanimously passed the bill last month. Kitzhaber has indicated that he will sign the bill. 

The new law will give unpaid interns legal recourse against employers for workplace violations including sexual harassment; discrimination based on race, color, religion, gender, sexual orientation, national origin, marital status or age; and retaliation for whistleblowing, among other things.

With no protection in state law, you might think that unpaid interns could turn to federal law. You’d be wrong.

The Equal Employment Opportunity Commission has issued  guidelines that provide coverage to volunteers under Title VII of the Civil Rights Act of 1964 “if the volunteer work is required for regular employment or regularly leads to employment with the same entity.”  However, unpaid interns have been unable to bring sexual harassment or civil rights complaints under Title VII  because judges have not found them to be “employees”  to whom protections are explicitly afforded.

According to a  2010 study by the Economic Policy Institute (EPI), federal courts have consistently found that the question of whether an individual is compensated for his or her work by an employer is the first test for determining employee status. Accordingly, unpaid interns, or even interns paid by an entity other than an employer, do not receive workplace discrimination protection.

The EPI study reports that the leading precedent for the failure to protect unpaid interns is the case of O’Connor v. Davis,  126 F.3d 112 (2d Cir. 1997).  Bridget O’Connor was required to complete an internship for her college degree and chose to work at a local psychiatric center. There, O’Connor allegedly was subject to repeated sexual harassment by one of her supervisors, Dr. James Davis. The district court summarily dismissed O’Connor’s complaint because the plaintiff, as an unpaid intern, did not receive compensation from the center, and thus did not qualify as an employee protected under Title VII. The decision was upheld on appeal.

Oregon Labor Commissioner Brad Avakian told the Associated Press that interns had contacted his office looking for help in the past and “we had to tell them that the law did not protect them.”

Under the measure, an intern who alleges workplace harassment or discrimination, among other violations, can bring a lawsuit against the employer or file a formal complaint with the Oregon Bureau of Labor and Industries.

Avakian said the idea for the bill came from a legislative intern at the Bureau of Labor and Industries. He said the intern discovered the loophole and brought it to his attention.  In 2011, a similar bill failed to gain traction. This year, however, the bill passed with broad support from civil rights groups and a student advocacy group.

The Oregon law  does not create an employment relationship and does not affect wage or workers’ compensation laws.

 Photo by: John Amis

 

 

Filed Under: DISPATCHES, SEXUAL HARASSMENT, STATE Tagged With: , , , , , , , , , ,

Somewhat Improved Healthy Workplace Bill

March 3, 2013 by 3 Comments

… But Still Needs Work

The heretofore anemic  Healthy Workplace Bill (HWB) has received a dose of iron in its latest iteration in Massachusetts.

The version of the  HWB subpumping ironmitted for consideration to the Massachusetts’ legislature omits  the  $25,000 cap on damages for targets who were not subjected to demotion or dismissal.

The Workplace Bullying Institute has pushed the HWB, written by Suffolk University Law Professor David C. Yamada,  for more than a decade as part of state-by-state campaign to pass workplace anti-bullying legislation.  More than 20 states have considered the HWB bill since  2002 but none as yet have adopted it.  This year the bill is under consideration in about a half dozen states.

International scholars criticized the HWB in recent years because it was far less protective of targets of workplace bullying than laws and regulations of other industrialized countries.

This blog criticized the HWB’s  requirements that targets prove malice and psychological damage (the latter was expressly rejected by the U.S. Supreme Court in federal anti-discrimination laws) and the unreasonably low cap on damages.

The revised bill still defines an abusive work environment as one where “an employer or one or more of its employees, acting with intent to cause pain or distress to an employee, subjects that employee to abusive conduct that causes physical harm, psychological harm, or both.”

How would one go about providing that a  bully acted “with intent to cause pain  or distress?”  I have no idea. Suggestions?

In addition,  workplace bullying almost always involves psychological harm. The bill’s requirement to prove psychological harm penalizes poor people and members of minority groups who tend to visit mental health professionals far less frequently for monetary or cultural reasons.  In addition, this approach was explicitly rejected by the U.S. Supreme Court as a requirement in race and sex  discrimination cases involving a hostile workplace . (Harris v. Forklift System,  510 U.S. 17 (1993)).

The proposed  Massachusetts bill,  sponsored by Rep. Ellen Story and Sen. Katherine Clark.

A far better alternative to the problem of workplace bullying has been proposed by State Sen. Richard “Tick” Segerblom of Nevada.

Segerblom proposed extending the umbrella of  discrimination laws to protect any worker who is exposed to a “hostile work environment.”  Currently, only workers who have protected status under these laws by virtue of their race, sex, national original, etc. are protected.

If an employer or an employee are held to be in violation of the law, the Massachusetts bill  provides  that a court can  order any relief that is “deemed appropriate, including, but not limited to: reinstatement, removal of the offending party from the complainant’s work environment, back pay, front pay, medical expenses, compensation for pain and suffering, compensation for emotional distress, punitive damages, and attorney’s fees.”

According to the proposed bill, an abusive workplace environment is one where “an employer or one or more its employees, acting with intent to cause pain or distress to an employee, subjects that employee to abusive conduct that causes physical harm, psychological harm, or both.”

Abusive conduct involves “acts, omissions, or both, that a reasonable person would find abusive, based on the severity, nature, and frequency of the conduct … .”  This includes but is not limited to:

  • repeated verbal abuse such as the use of derogatory remarks, insults, and epithets;
  • verbal, non-verbal, or physical conduct of a threatening, intimidating, or humiliating nature;
  • or the sabotage or undermining of an employee’s work performance.

The proposed Massachusetts bill continues to distinguish between targets of  bullying who have and have not been subjected to an adverse employment action (i.e., demotion or dismissal).  The cap is gone but the latter still cannot  recover from the employer  damages for  emotional distress or punitive damages unless the “actionable conduct was extreme and outrageous.” This limitation does not apply to “individually named defendants.”  Thus, an employee who did not suffer an adverse employment action can only seek monetary damages from bully unless the actionable conduct was extreme and outrageous.

The bill also prohibits retaliation against targets who complain and anyone else who testifies, assists or participates in an investigation of workplace bullying.

The stated purpose of the Massachusetts bill is to provide a “legal incentive for employers” to prevent and respond to abusive treatment of employers at work.

Under the bill, it is  an “aggravating factor” if the abusive conduct exploits an employee’s known psychological or physical illness or disability. In that case, a single act that is “especially severe and egregious” would be actionable.

Employers  can escape liability by showing they exercised “reasonable care to prevent and correct  promptly any actionable behavior; and, the complainant employee unreasonably failed to take advantage of appropriate preventive or corrective opportunities provided by the employer.”

Also, employers cannot be penalized if the complaint is based on an adverse employment action made for poor performance, misconduct or economic necessity, a reasonable performance evaluation or “an employer’s reasonable investigation about potentially illegal or unethical activity.”

The bill would require an employee to  file an action within a year of  the last act that constitutes the alleged violation.

Filed Under: DISPATCHES, STATE, WORKPLACE BULLYING Tagged With: , , , , , , , ,

Strippers are ‘Employees’

February 10, 2013 by Leave a Comment

When is a worker  an employee who is entitled to a salary and unemployment benefits?

This question was at issue in a Kansas case that sheds light on the exploitative world of strip clubs and so-called gentlemen clubs.

Shortly after Milano’s, Inc. purchased a Topeka strip club called Club Orleans in 2002,  company President John Samples began treating the club’s exotic dancers as independent contractors rather than employees.  This meant the dancers were no longer paid even a nominal weekly wage, instead earning only tips paid by customers of Club Orleans. And they were not paid health or insurance benefits.

In 2005,  one of the dancers filed an unemployment claim, prompting the state to assign an auditor to investigate Milano’s. The auditor concluded  the dancers were not independent contractors but were employees under Kansas law.

Milano’s challenged the auditor’s determination on various technical grounds and two  lower courts upheld the determination. The case finally reached the Supreme Court of the State of Kansas.

Earlier this month, the Kansas Supreme Court  ruled that the determinative question was whether the dancers had the status of employees under common law rules that determine the employer-employee relationship. The Court said in Milano’s, Inc. v. Dep’t of Labor that the critical common-law factor in the analysis was the employer’s right of control over the employee and her work.

The record showed that the dancers were required to sign what was essentially  a “contract for hire” in the form of an application to work at Milano’s. The contract required the dancers to  abide by the house rules and gave Milano’s the right to fine or terminate the dancers.  Furthermore,  Milano’s, without consulting the dancers, adopted a  minimum tip policy for various types of dances and required the dancers to accept drinks from customers. Milano’s enforced the house rules.

According to the Court:

“Ample substantial competent evidence in the record before us, as echoed in the factual findings below, demonstrates that Milano’s possessed such a right of control over the dancers at Club Orleans. Most telling, the house set various rules, and dancers’ violations of those rules were punishable by fines and termination.”

The Court concluded that exotic dancers subject to a right of control by the owner of the club where they perform are employees under the “usual common law rules” incorporated into K.S.A. 44-703(i)(1)(B) of the Kansas Employment Security Law.

Although the ruling was limited to unemployment insurance benefits, it could have an impact on other independent contractors who seek employee status to be eligible for employment benefits such as workers compensation, disability benefits, etc.

Wage theft is epidemic  in the United States, according to the Progressive States Network (PSN),  a non-partisan, non-profit organization dedicated to supporting the work of progressive state legislators around the country and to the advancement of state policies that support issues that matter to working families.

Wage theft occurs when employers  misclassify workers as exempt employees when they are actually non-exempt employees (who are entitled to overtime)  or  misclassify workers as  independent contractors when they are truly employees.

The PSN estimates that more than 60 percent of low-wage workers suffer wage violations each week. On average, the PSN reports, low-wage workers lose $51 per week to wage theft, or $2,634 per year.  For low-wage workers, that amounts to 15 percent of their annual income, at average earnings of $17,616 per year.

Filed Under: DISPATCHES, STATE Tagged With: Contract for Hire, definition of employee, , Inc. v. Dep't of Labor", , Kansas Supreme Court, Milano's, , Supreme Court of the State of Kansas,

Chicago’s Innovative Effort to Stop Wage Theft

January 25, 2013 by Leave a Comment

cityofbroadshoulders

The city of Chicago this month  became the second, and biggest, city to pass an ordinance addressing the problem of  wage theft.

The Chicago ordinance appears to be an innovative and potentially highly effective initiative to combat a  problem that disproportionately affects low wage workers and undocumented immigrants.

  The ordinance states any licensee that is in the business of debt collection must comply with federal and state wage and hour laws. It states that failure to comply with these laws  can result in the revocation of the company’s business license for at least four years.  The ordinance potentially covers most licensees, since most  companies  engage in debt collection in the ordinary course of business. This includes everything from licensed day care centers to hotels and beauty parlors.

 Last fall, the Broward County Commission in Florida passed an ordinance that allows employees who are owed $60 or more for work done in the county to turn to the county for help.  Before filing the complaint, however, the employee must write a letter to the employer outlining how much is owed. If the paycheck shows up within 15 days, the complaint wouldn’t be filed.

Epidemic

Wage theft is widely considered to be epidemic in the United States.

Aaccording to a report released last year by the Progressive States Network (PSN ) state laws are grossly inadequate to combat  “wage theft” by unscrupulous employers. Some states levy no fines at all for wage theft, according to the report, while most others invoke penalties smaller than a speeding ticket.

 There is, of course,  an overarching  federal law that prohibits wage theft – the Fair Labor Standards Act (FLSA) – but it largely relies upon voluntary compliance.

 The FLSA establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $7.25 per hour and overtime pay at a rate not less than one and one-half times the regular rate of pay is required after 40 hours of work in a workweek.

 The FLSA is technically “enforced” by the Wage and Hour Division of the U.S. Department of Labor (DOL) but, as the PSN report notes, the DOL has only one enforcement agent for every 141,000 workers, down from one per 11,000 workers in 1941.

 The PSN estimates that more than 60% of low-wage workers suffer wage violations each week.  On average, the PSN reports, low-wage workers lose $51 per week to wage theft, or $2,634 per year. For low-wage workers, that amounts to 15% of their annual income, at average earnings of $17,616 per year.

Misclassification of Employees

Rogue employers often evade complying with wage and hour laws by classifying non-exempt employees as exempt under the FLSA and thus not entitled to overtime.

I once worked for an organizaton that misclassified administrative assistants  as exempt, requiring them to work long periods of uncompensated overtime at conferences and events. After years of this, one employee filed an anonymous complaint with the DOL. The organization was forced to pay affected employees who were  then on the payroll minimal amounts to supposedly compensate them for their loss.  This was an insignificant penalty for the employer,  considering the years of abuse that had occurred and the many uncompensated victims who were no longer working at the company.

To qualify for an  exemption from the FLSA, an employee must be paid on a salary basis at a rate not less than $455 per week, must perform work directly related to the  management or business operation of the employer, and must be responsible for exercising independent judgment or discretion with respect to matters of significance.

 Another way that employers circumvent the FLSA is to classify employees as independent contractors. This is not inherently illegal but it can be if the purpose of the independent contractor classification  is to deny the employee access to benefits and protections – such as family and medical leave, overtime compensation, minimum wage pay and unemployment compensation.

 In 2011, the DOL launched a “Misclassification Initiative” to address the problem with respect to independent contractors. Thus far, the states of Iowa, California, Colorado, Connecticut, Hawaii, Illinois, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, Utah and Washington have signed memorandums of agreement to join the DOL initiative. The agreements will enable the DOL to share information and coordinate enforcement efforts with the participating states.

 Misclassification creates economic pressure for law-abiding business owners, who find it difficult to compete with those who are skirting the law. Employee misclassification also generates substantial losses for state Unemployment Insurance and workers’ compensation funds.

 Alderman Ameya Pawar spearheaded the Chicago effort to pass the wage theft ordinance is quoted as stating: “I sponsored this ordinance because it’s something that’s deeply personal to me.  I’ve worked with refugees in the past and I’ve seen how vulnerable populations have become victims to wage theft.”

Filed Under: DISPATCHES, STATE Tagged With: , , , , , , , , , , ,