david foleys blog

David Foley's Labor and Employment Law Blog

Thursday, February 6, 2014


Pope John Paul II

Ken Matheny has an article out in the Winter 2014 issue of the Southern California Interdisciplinary Law Journal, The Disappearance of Labor Unions and the Social Encyclicals of Popes John Paul II and Benedict XVI.  It is worth a read for anyone interested in labor and employment issues and a must read for Catholics.  The article, like many, considers changes to the economic landscape and the diminished relevance of labor unions in America today while offering thoughts on the future of workers' associations.  Unlike other articles that contemplate these issues,  Matheny's article is powerfully informed by centuries of Catholic social doctrine and informs the reader along the way.

Friday, May 31, 2013

Inherently Concerted: Sabo, Inc. d/b/a Hoodview Vending 359 NLRB No. 36 (2012)

Can a simple discussion between employees be protected concerted activity under Section 7 of the NLRA?


If employees are discussing a "vital term and condition" of employment, they are protected when they talk to one another about it.  These conversations are "inherently concerted."  It does not matter if the speaker or the listener agreed, or whether the speaker was trying to change things or persuade the listener. This is a bright line rule.  With one exception...

What are "vital terms and conditions of employment"?

According to the NLRB, they are the terms/conditions that you might generally expect employees to seek unionization about or engage in other group action about.  These are the basic ingredients, the flour, eggs, and sugar if you will, of organization and collective action.  So far, the Board has identified wages, work schedules/hours, and job security as "vital terms and conditions".

Are there others?

 I don't think that the list could be too large, but some other basics might make it.  For instance, safety would be a good candidate in my book.

The Board lays out the history of this doctrine and its justification in Hoodview Vending, 359 NLRB No. 36 (2012).  It is well worth the read, but in case you would rather watch, I have put together two animated scenes (30 seconds each) that depict the essence of the relevant facts.  The first once shows the essence of the activity at issue and the second scene captures essentially what the Board believed happened.

The Board held that because job security is a vital term, the conversation was inherently concerted and therefore the discharge was unlawful.

Wednesday, January 30, 2013

Jujitsu in EEOC v. Kaplan

I have always loved the passage from The Art of War about the general who is facing an enemy army on the other side of a river.  The two armies are at a stand off.  The general is informed that his forces are running perilously low on arrows (and won't be able to ward off an attack). What does the general do? He orders empty boats swung out at the enemy in a feigned attack.  The enemy volleys a multitude of arrows at the boats.  The boats are hauled back in and the general has his men collect the wasted arrows.
What a tactic; you start from a position of weakness, then use cunning to drain your enemy of his resources while simultaneously restoring yourself to a position of strength.

This isn't an exact parallel to the general on the river, but something about what happened in  EEOC v. Kaplan Higher Learning Edu. Corp. (N.D. Ohio 1/28/13) reminds me of it.  In that case, which issued earlier this week, Kaplan's attorneys turned the EEOC's policies back around at themselves (twice) and as a result won a motion for summary judgment.  How can you not admire that kind of lawyering?

As you may recall, as part of its statistical discrimination initiative, in 2010, the EEOC filed a suit against Kaplan University for its practice of using applicants' credit histories as a factor in hiring decisions.  Kaplan was not docking applicants for late payments or grading them on debt/asset ratios, but was only looking at large defaults and other red flags.  The EEOC alleged that Kaplan's practice was discriminating against minorities based on the disparate impact of these practices.

Kaplan's first legal Jujitsu maneuver was during discovery where it requested documents establishing the EEOC's own practice of using credit history to assess job candidates.  The EEOC at first committed to turning the records over, then balked, then was ordered to turn them over by a not so happy federal judge (Judge Patricia Gaughan).  As it turns out, the EEOC itself looks at applicant credit reports in 84 of its 97 positions because “overdue just debts increase temptation to commit illegal or unethical acts as a means of gaining funds to meet financial obligations”.  Although the case did not turn on this discovery request, there is a certain irony in that the rationale that the EEOC uses to defend its regular practice of checking applicants' credit history applies just as equally to every employer the EEOC regulates, and that irony does not appear to have been lost on Judge Gaughan.

Kaplan's second and critical act of Jujitsu came when it challenged the EEOC's prima facie case.  The EEOC's prima facie case was based on evidence that the applicants that Kaplan rejected on the basis of credit reports were disproportionately minorities.  To establish this prima facie case, the EEOC needed one critical piece of data: the race/ethnicity of the applicants.  Getting this information was an obstacle for the EEOC because Kaplan did not record the race of its applicants (the EEOC attempted to no avail to argue that the EEOC's model guidelines for employers call for gathering and retaining such information).

In order to find out the respective races of the applicants, the EEOC used their names and presumably their social security numbers to look up information about them from their local departments of motor vehicles.  However, only 14 of the 38 states from which the applicants hailed had records of race associated with drivers licenses.  For those states that did not have racial self-identification on the drivers license, the EEOC ordered the drivers license photographs of the applicants...With the pictures in hand, the EEOC had a panel of five "expert" "race raters" look at the pictures and determine the race of the applicants...You might be wondering, "What kind of credential does an expert race rater have?" The judge also wondered and was not at all impressed with their varied credentials of the raters who held advanced degrees in either economics, human development, psychology, or cultural anthropology, and had no established background in visually identifying an individual's race.  Further discrediting the "race rater" panel was its inability for 80% of its raters to reach a consensus as to the race of 11.7% of the applicants.

The lack of expertise and inability to reliably judge race was bad enough for the EEOC, but Kaplan's second Jujitsu move came in when they showed that the EEOC's own guidelines (the ones they tried to employ against Kaplan) deem visual identification as an undesirable way of identifying race and ethnicity. Thus Judge Gaughan noted that the "EEOC itself frowns on the very practice it seeks to rely on in this case" and ultimately dismissed the complaint on summary judgement for lack of a prima facie case.

Kaplan's attorneys did not exactly mimic the general on the river, but like him, they started from a position of weakness and used cunning to turn their adversary's resources against it.

As an aside some people have wondered what happened to the blog...I am still alive...and I think that you'll agree that I have good reason for failure to post, at least for the last nine weeks...

(Her credit is pretty good by the way)

Friday, September 7, 2012

ABA Law Blog 100 and Ryan Holiday's Book

Today is the last day to make nominations to the ABA's top 100 law blog competition.  Coincidentally, I've been reading Ryan Holiday's book, Trust Me, I'm Lying: Confessions of a Media ManipulatorIn the book, Holiday lays out in pretty grim detail the dark-side of blogs and the ways the Internet has changed journalism for the worse.  Fortunately, in my own opinion, the legal blogosphere seems to be in a lot better shape than than the general blogosphere. This is primarily because the authors of legal blogs are lawyers whose income is tied to actual off-line legal practice rather than ads they sell on their blogs, and because as attorneys they are bound by ethics and have more of a sense of responsibility than the average blogger.  That being said, I don't think that our corner of the Internet is immune to the problems Holiday rightly shows are out there. 

Here are some of the things that are on my mind as I make my nominations to the ABA top 100:

According to Holiday,
The constraints of blogging create artificial content, which is made real and impacts the outcome of real world events....The economics of the Internet created a twisted set of incentives that make traffic more important-and more profitable-than the truth...Every blog, publisher, and oversharer in your Facebook feed is constantly looking to post things that will take on a life of their own and get attention, links, and new readers with the least work possible.  Whether the content is accurate, important, or helpful doesn't even register on their list or priorities...
 I don't think that the last sentence (or the paragraph) is true of the blogs I read.  One of the top priorities for legal bloggers is accuracy.  We are all wrong sometimes, but I think we strive to get it right and only write about issues that are important, helpful or (to build upon Holiday's list) entertaining.  Particularly, I look for helpful blogs.  However, as Holiday writes, being helpful is not the way to drive traffic:
For example: Movie reviews, in-depth tutorials, technical analysis, and recipes are typically popular with the initial audience and occasionally appear on the most e-mailed lists.  But they tend not to draw significant amounts of traffic from other websites.  They are less fun to share and spread less as a result.  This may seem counter-intuitive at first, but it makes perfect sense according to the economics of online content.  Commentary on top of someone else's commentary or advice is cumbersome and often not very interesting to read.  Worse, the writer of the original material may have been so thorough as to have solved the problem or proffered a reasonable solution - two very big dampers on getting a heated debate going.
 For blogs, practical utility is often a liability....Being final, or authoritative, or helpful, or any of these obviously positive attributes is avoided, because they don't bait user engagement. And engaged users are where the money is.
 With that said, here are three of my nominations for the ABA's top 100 law blog competition:

Workplace Prof Blog. Very helpful original content and very helpful linking. It makes me feel smarter just to skim through it.

Work Matters (Michael Maslanka's blog). I am always amazed when Maslanka gives away some tactical advice like a technique in a deposition.  But as a young lawyer, I love those tidbits.  Besides the tactical, Maslanka has a good bit of technical content and great content on the "counseling" side of the profession; i.e. wisdom.

BNA Daily Labor Report. I don't know if the BNA would like to be categorized as a blog, but according to Ryan Holiday, everything is a blog.  The fact that it is a paid subscription model keeps it a step ahead of any web-source out there.  The BNA does not try to drive traffic, it tries to produce a service and it works.  Accurate, important, helpful. I don't know about a lot of the things they report on, but if I skim through it, I have a better chance of sounding smart when someone wants to talk about ESOPs.

Click here to submit your nomination ABA's top 100 law blog competition.

Monday, August 20, 2012

NLRB Reiterates Rules on Investigation Confidentiality

A recent NLRB decision caused some ripples around the web, and I am a little bit surprised by the commotion.  The decision appears to have been a fairly straight forward reiteration of precedent that is at least a decade old.

The decision is Banner Estrella Medical Center, 358 NLRB No. 93 (2012). The cause of the controversy is the Board's ruling that the employer violated the NLRA through a policy that prohibited employee discussions about matters the employer was investigating.  After an employee made a complaint to the employer--pursuant to the employer's blanket policy--he was then forbidden from discussing the subject of the complaint with other employees.  Citing a similar decision it made last year in Hyundai America Shipping Agency, 357 NLRB No. 80, slip op. at 15 (2011), the Board stated
To justify a prohibition on employee discussion of ongoing investigations, an employer must show that it has a legitimate business justification that outweighs employees’ Section 7 rights.
This seems very similar to the Board's reasoning in Caesar’s Palace, 336 NLRB 271, 272 (2001)
The issue is whether the interests of the Respondent’s employees in discussing this aspect of their terms and conditions of employment outweighs the Respondent’s asserted legitimate and substantial business justifications.
In Caesar's Palace, the employer required silence among employees about an ongoing drug-investigation.  The Board held that the employer's interest in a safe investigation outweighed the employees' interest in discussing a workplace condition. 

In Phoenix Transit Systems, 337 NLRB 510 (2002), the Board found that the employer violated the NLRA by maintaining a confidentiality rule which prohibited employees from discussing their sexual harassment complaints among themselves.

In Hyundai America Shipping Agency, 357 NLRB No. 80, slip op. at 15 (2011) where managers "routinely instruct[ed] employees involved in investigations not to talk with other employees about the substance of those investigations", the employer's policy was considered unlawful.

Nothing then is surprising about the Board's conclusion in Banner Estrella where the employer had a blanket policy of instructing employees to refrain from discussing the subject matter of complaints while they were being investigated.

And the underlying principle hardly seems controversial. These are the main points as I see them:
1. Under Section 7 employees have the right to discuss terms and conditions of employment.
2. The terms and conditions of employment that employees have the right to discuss include issues such as whether a manager is sexually harassing an employee(s) and whether certain employees are being treated differently than other employees.
3. Employers will at times seek to investigate controversies surrounding the terms and conditions of employment.
4. If employers tell employees that they may not discuss the controversies while they are being investigated, they have necessarily infringed on the employees' Section 7 rights.
5. Any infringement on Section 7 rights must be justified.
6. Some workplace controversies require a high need of confidentiality to protect the employers' interests and the witnesses' interest. For instance an employer investigating a drug ring in its facility has an interest in protecting its witnesses from criminal retribution.
7. Some workplace controversies do not require a high degree of confidentiality to protect an employer's or witnesses' interest.  For example an employer investigating a matter that is mostly documented through email or caught on surveillance footage may not fear the effects of collusion as much as in purely "he said, she said" investigations.
8. Requiring employees to refrain from speaking to other employees about the subject of an investigation may work against the employees' interests because it may stop them from obtaining helpful information or generating a concerted protest.
9. Some balancing of the competing interests must be taken into consideration before stopping employees from discussing workplace conditions.

Wednesday, July 25, 2012

Box-Checking Gate Takeaway

A couple months ago there was a little political and media uproar, which has slowly simmered down, over what I am going to coin "Box-Checking Gate". The story involves revelations and allegations concerning how and when and for what purpose US Senate candidate and Harvard Law professor Elizabeth Warren claimed to be Native American.  Warren claims that her great-great grandmother was Cherokee, which (if true) would make her 1/32 Native American or 96% white. One issue raised is whether Warren's initial positions at the University of Pennsylvania Law School and Harvard Law School and her ultimate appointment as a tenured professor at Harvard in 1993 were influenced by her self-identification as Native American.  Another issue being raised is whether the law schools' identification of Warren as a minority woman meant that they appeared to have a more diverse staff than they did.

Conservative news source Breitbart.com makes its indictment of Warren here and the Christian Science Monitor gives a more Warren-favorable take here.

As always, I am not going to put my two cents into this political issue.  But the issue is after all an employment issue and the controversy brings my one-track mind back to labor and employment law. In terms of employment law, my takeaway from "Box-Checking Gate" is to reflect on just how seldom the issue arises.

Resume fraud in general is a recurrent issue. For instance, there was nothing terribly unique about similarly timed revelations that Yahoo CEO Scott Thompson had fudged his online bio to include a computer science degree rather than his actual degree in accounting.  But while Thompson's story sounded familiar to me, I can only recall one similar story of an employee's eyebrow raising claims of minority status being used against them. The one story, perhaps coincidentally, also involves a claim to Native American heritage:  the former controversial University of Colorado Ethnic Studies professor  Ward Churchill.  Like Warren, if Churchill had not placed himself in the center of intense media scrutiny, his claims would never have been investigated.

In both Warren's and Churchill's cases, responses from faculty have been that ethnicity did not factor into the hiring decision or the decision to offer Warren tenure. But that strikes me a lot like the early responses from the baseball world when the tip of the steroid iceberg was being discovered. The response you often heard was "steroids don't help them play better anyway."   Like the baseball response, the point the deans are making is, "Even if they did lie about being a minority, it wouldn't have helped them anyway."  Whether Warren's and Churchill's self-identifications helped them in those particular hires/promotions requires fact specific inquiry.  But in general, there is no question that being a member of a minority group gives an applicant an advantage in a hiring pool in many employment settings. The only question is how much of an advantage.

Affirmative action programs are in place at city, county, state and federal government employers and employers who contract with the government. Many, many companies contract with the federal government.

But beyond government contractors, many employers, whether out of a sense of moral responsibility or in response to litigation or potential litigation, have affirmative action programs.  For instance according to the Breitbar article above, at the time Elizabeth Warren was appointed tenure, Harvard Law was under pressure to diversify, specifically to employ women of color.  What this all means is that in many employment situations, a candidate for a position can boost his prospects significantly if he claims minority status. Exactly how much a candidate's minority status boosts an applicant's prospects, I have no idea.

But regardless of what exactly the boost is, there is obviously a potential gain for would be falsifiers.  As the old proverb goes, "Opportunity makes the thief."  One would expect that with the opportunity for gain by falsification, there would be a fair number of falsifiers. And yet, stories such as Warren's and Churchill's are extraordinarily rare.  So either no one is falsifying or no one is checking. Or both.

Regarding the latter, it would seem that no one is checking. Look for example at this Department of Labor Q&A on reporting requirements for government contractors:
What is the correct procedure for a contractor to obtain the ethnic information of its employees and applicants?
...Self-identification is the most reliable method and preferred method for compiling information about a person's gender, race and ethnicity. Contractors are strongly encouraged to rely on employee self-identification to obtain this information....
...May an employer override an individual's self-identification of race, gender or ethnicity based on the employer's visual observation?
No. OFCCP's policy is that deference should be given to an individual's self-identification and it should not be questioned or overridden by an employer based on the employer's visual observation.
So if Employers have an obligation not to check the integrity of employees' self-identification, are there any checks at all in this system?

The prospect of being accused of fraud might act as a check against false self-identification. But consider the nine elements of common law fraud:
  1. A representation
  2. Its materiality
  3. Its falsity
  4. The speaker's knowledge of the falsity
  5. The speaker's intent that the representation be acted upon by the plaintiff
  6.  Ignorance of the falsity
  7. Reliance on the falsity
  8. Right to rely on the falsity
  9. Consequential damages suffered by the plaintiff
The first element is clear one is clear: the box is checked. By number 2, though we are already in dispute because we don't really know how significant the representation is in the application.  But the third element is where the case gets slippery.

What does it mean to be a minority? That question requires one to look at each box. There are three basic categories that will put one into a minority status that could result in a preference: 1.) Native American, 2.) African American and 3.) Hispanic.

What does it mean to be Native American? Here is a definition from an EEOC report glossary:

American Indian/Alaskan Native - All persons having origins in any of the original peoples of North and South America (including Central America), and who maintain cultural identification through tribal affiliation or community recognition.

So, the origins part of this definition is pretty loose.  A person might claim to have "origins in any of the original peoples" if his grandfather told him that his great-great grandfather was a Native American.
 Looking at Element 3 of fraud, some might want to argue that if the only claim to being Native American is a grandfather's assertions about something he was told by his grandfather, you have a double hearsay problem and it can't be proven.  But, interestingly enough, the Federal Rules of Evidence address an exception to this at 803, Exception 19:
(19) Reputation Concerning Personal or Family History. A reputation among a person’s family by blood, adoption, or marriage — or among a person’s associates or in the community — concerning the person’s birth, adoption, legitimacy, ancestry, marriage, divorce, death, relationship by blood, adoption, or marriage, or similar facts of personal or family history.
 So, what a person's grandfather told him might hold up, at least for the first half of the definition.  But the second half of the definition "and who maintain cultural identification through tribal affiliation or community recognition" is trickier.  The big question here is does "tribal affiliation" refer to a tribe's acceptance of the person as a member or quasi-member or is the box-checker's point of view what matters, as in "I feel affiliated to that tribe." Presumably, a person is only affiliated with a tribe or recognized by a community if a tribe/community says so.

The definition of who is Black is similar to who is a Native American without the affiliation part.
Black (Not of Hispanic Origin) - All persons having origins in any of the Black racial groups of Africa.
By this definition, so long as a box-checker has one identifiable black fore-barer or can otherwise prove that  origins in any of the black racial groups of Africa, you have not misrepresented yourself as black.  So, if your family lore is that your great-great grandmother was black, you can claim to be black.  What if you don't know of any black ancestors, but you do a DNA test and that shows that some distant ancestor of yours was black? That seems like you have shown some claim to black origins.  Here is an article by Thomas Chatterton Williams, Black as We Wish to Be, discussing his struggles with thinking about whether his children and grandchildren should identify as black.  

Finally, there is Hispanic. The EEOC glossary defines Hispanic this way:
Hispanic or Latino - All persons of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race
Looking at the first part of the definition, there are questions as to some exceptions - for instance, there are German-descended and German speaking Mennonites in Mexico. Also, there are plenty of non-Hispanic Americans from the States who migrate to Puerto Rico. If a non-Hispanic couple moves to Puerto Rico do they become Hispanic by virtue of living in an Hispanic majority culture? If they have a child in Puerto Rico but then emmigrate back to New York, is the child Hispanic because he has an origin in Puerto Rico? Are their children Hispanic if they have an origin in Puerto Rico?  Looking at "South or Central America" one has to wonder about inhabitants (and British Citizens) of the Falkland Islands. They are South American, but are they Hispanic?  The US Census Bureau answers these types of questions with its definition, which is essentially: you are Hispanic if you think you are Hispanic.

These definitions are so loose that it would be very hard to prove that someone actually did not belong in the box they checked themselves into.  Under this loose definition, even English-descended people from states like California, Texas, and Florida--which are former members of the Spanish Empire and have continuing high Spanish cultural legacy--could have some, if dubious, claim that their state is a "Spanish culture," and they are therefore Hispanic. But even if you could prove that the box was wrongly checked, you would still need to prove the rest of the elements.

 Going to the Element 4, "knowingly", a box-checker who got it wrong could argue that they misunderstood the definition or that they relied on bad facts.  Elements 5-8 would also be difficult to prove, but even more so for Element 9, consequential damages for plaintiff.  Who suffers consequential damages when an applicant checks a false box? The most obviously damaged person would be applicants who did not get the job.  But how often are they in a position to find out what happened?

In short, fraud actions seem like an unlikely vehicle to act as a major curb to false box-checking.

Even without serious checks, I doubt that falsifications are rampant and would like to believe that they are rare.  Although there is an opportunity, most people choose to do the right thing.  Nonetheless, it would be interesting to find out if there are any figures on this and if anyone knows a good source, please shoot me an email or drop a comment.