Tag Archives: liability

Fair Labor Standard Act and Individual Liability

In Torres et al. v. Gristedes Operating Corp. et al., Case No. 11-4035 (July 9, 2013), the Second Circuit Court of Appeals held that a mayoral candidate, a supermarket owner, and an executive can be individually liable for settlement payments arising of a Fair Labor Standard Act class action.

In this case, the parties settled the class action.  A class action is a discrimination case brought by a few plaintiffs on behalf of many employees.  All of the members who agreed to be part of the class (the individuals who were discriminated against) receive their part of the settlement.  In order for a fair disbursement, the Judge must adopt the settlement.

Under the settlement, the defendants agreed to pay $3.5 million to the class.  However, the defendants defaulted on the payments.  The judge’s order allowed the class to enforce the settlement.  Defendants, who sought to change the settlement, stated that they were not bound by the settlement because they were not “employers.”

The Second Circuit Court of Appeals disagreed.  The Court noted that the defendants exercised “operational control” that affected the class’ employment.  For example, based of their decisions, the employees’ wages were affected.  Because defendants were employers, defendants were bound by the settlement.  Based on this decision, defendants now have to pay the owed money.

via Labor Employment Law Blog: Second Circuit Imposes Individual Liability on New York Mayoral Candidate for Fair Labor Standards Act Settlement.

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EEOC’s First GINA Suit Settlement

The first settlement between the EEOC and an employer over GINA is important because it brings attention to this relatively new law.  EEOC charges alleging GINA violations have increased each year.  Consequently, it is important for employers to ensure their policies and procedures are compliant with GINA procedures.

The Genetic Information Nondiscrimination Act (GINA) went into effect in 2009.  Some of GINA’s regulations are as follows.

  • It is illegal for employers to discriminate against employees or applicants based on their genetic information.
  • Employers cannot request or obtain genetic information, which includes any information about an employee or an applicant’s family history.
  • GINA also applies to third parties.  So, employers cannot request or obtain family medical history, even through a third-party medical provider or examiner.
  • There are exceptions for voluntary health risk assessments.  However, if the employee is receiving an incentive for completion of the Health Risk Assessment, the employer must make clear that an employee need not answer any of the questions about family medical history in order to obtain the incentive.

On May 7, 2013, the U.S. Equal Employment Opportunity Commission (“EEOC”) reached a milestone of sorts as it filed – and then settled – its first complaint ever alleging genetic discrimination under the Genetic Information Nondiscrimination Act of 2008 (“GINA”).

The EEOC filed suit in Oklahoma federal court against Fabricut Inc., one of the world’s largest distributors of decorative fabrics, alleging that Fabricut violated GINA and the Americans With Disabilities Act (“ADA”) by unlawfully asking a job applicant for her family medical history in a pre-employment, post-job offer medical examination, and allegedly rescinding her job offer based on the belief that she had carpal tunnel syndrome.

The EEOC and Fabricut reached a settlement, which is the first settlement in a GINA case.  In the consent decree, Fabricut agreed to pay $50,000 but did not admit to violating GINA or the ADA.

via EEOC’s First GINA Suit Serves As Reminder of Pre-Employment Exam Pitfall | Proskauer Rose LLP – JDSupra.

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Virginia Sup Ct Holds Supervisor Can Be Personally Liable

A divided Virginia Supreme Court recently held 4-3 that a state law claim of wrongful discharge in violation of public policy may be pursued against an individual supervisor or manager who participated in the wrongful firing but was not the workers actual employer VanBuren v. Grubb, Va., No. 120348, 11/1/12.

Writing for the majority to answer a question certified by the Fourth Circuit, Justice Millette says the purpose of Virginias wrongful discharge tort is to deter firings in violation of public policy. That purpose “is best served if individual employees in a position of power are held personally liable for their tortious conduct.”

By contrast, the dissent would find “[o]nly an employer can breach that duty because only an employer has the ability to hire and fire.”

via Adjunct Law Prof Blog: Virginia Supremes Hold That Supervisor Can Be Personally Liable In Public Policy Exception Case.

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Who is a “supervisor” in a sexual harassment case? Supreme Court will decide

On November 26th, the Supreme Court will hear arguments in the case Vance v. Ball State University (11-556) coming from the 7th Circuit.  The issue in this case centers around the word “supervisor.”

In Faragher/Ellerth, as decided by the Supreme Court, the Court stated there is vicarious liability when the sexual harasser is the victim’s supervisor.  In other words, if the harasser is the supervisor, the employer is immediately liable unless two exceptions (described in Faragher/Ellerth) are met.

The issued posited to the Supreme Court is whether the supervisor liability rule is limited to those who have the authority to direct and oversee the victim’s daily work, or limited to those who have the power to hire, fire, demote, promote, transfer or discipline.

What’s so interesting about this case, you may ask?  The fact that courts all throughout the US are split on this definition.  Will this definition be broadly construed, narrowly construed?  If so, what would the consequences be of this decision.  Will sexual harassment claims be significantly reduced?  Will attorneys think of these claims as incredibly risky, and be less likely to pursue these claims?

As it is, civil rights have traditionally been limited.  The purpose of Title VII is to be broadly construed in order to provide civil rights protection.  The purpose of Title VII appears to be eaten away slowly.  It really does remind me of ADA before Congress enacted the ADAA.

In the ADA situation, Courts continuously narrowed the definitions and limited the extent to which a disability was covered by the Act.  Under the ADA, a disability was not covered if medical treatment reduced its impairment whereby the impairment was no longer significant.  When the ADAA was passed, Congress sternly pointed out to the extent the Courts had gone out of their way to prevent coverage under the Act for disabilities. In the ADAA, Congress specifically pointed to Supreme Court cases narrowing coverage under the Act.

Is it time for Congress to act once again?

via Vance v. Ball State University : SCOTUSblog.

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Cat’s Paw and Personal Liability

The Proactive Employer ran an interesting blog post on July 17, 2012 which reported on a case where a supervisor had personal liability under a Cat Paw type of case.

As you will recall, the Supremes in Staub v. Proctor Hospital, held that employers can be liable for discrimination based on the bias of an employee’s supervisors, even though the supervisor in question did not make the actual decision to terminate the employee.

Combine that holding with a 1981 case which permits personal liability and you get a case involving the Cat’s Paw and personal liability.  The case is Smith v. Brady from the 7th Circuit.

via Adjunct Law Prof Blog: Cat’s Paw and Personal Liability.

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Case to watch re: supervisor liability

Ball v. Vance is the name of the case.

Issue: Whether the “supervisor” liability rule established by Faragher v. City of Boca Raton and Burlington Industries, Inc. v. Ellerth (i) applies to harassment by those whom the employer vests with authority to direct and oversee their victim’s daily work, or (ii) is limited to those harassers who have the power to “hire, fire, demote, promote, transfer, or discipline” their victim.

via Adjunct Law Prof Blog: Supremes Grant Cert In Case Involving Faragher Affirmative Defense.

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Criminal liability for illegal content stored in the cloud

A verdict against Megaupload in the US would mean other cloud storage providers can be held criminally liable for illegal content stored by customers on their networks, a lawyer representing the shuttered file-sharing site said.

Prosecutors in the US have accused Megaupload and seven people associated with the company, including founder Kim Dotcom, of copyright infringement, aiding and abetting copyright infringement, wire fraud and money laundering. The US has started proceedings to extradite them from New Zealand to the US, where they hope to put the company on trial.

It would be the first time a provider of cloud storage services had been charged with criminal copyright infringement in the US, said lawyer Ira Rothken, who will represent Megaupload if the case comes to trial.

The cases against the music file-sharing services Grokster and Napster were both civil cases, meaning they were brought by aggrieved parties, such as the record companies, as opposed to the state. Civil cases generally require a lower burden of proof, making them easier to prove.

via Megaupload lawyer says case could affect other storage services | Computerworld New Zealand.

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EEOC on GINA and ADA

Maintaining employees’ personal and occupational health information in a single electronic medical record (EMR), particularly one that permits individuals with access to the EMR to view any information in the record, “presents a real possibility” that the ADA or the Genetic Information Nondiscrimination Act (GINA), or both, will be violated, according to an EEOC informal discussion letter released on June 30, 2011.

An agency letter, dated May 31, 2011, and signed by EEOC Legal Counsel Peggy R. Mastroianni, addresses two issues:

1. whether an employer or its agent should have access to an employee’s personal health information without the employee’s consent; and

2. the manner in which employers must safeguard employees’ medical information.

Title I of the ADA and Title II of the GINA both limit employer access to medical information. The letter provides a roadmap to when personal health information about applicants or employees may be accessed, regardless of whether an employer or an occupational health provider maintains information in paper or electronic files.

via Keeping employees’ personal and occupational health information in one file poses risk of ADA and GINA violations, EEOC letter warns | Employment Law Daily.

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