Welcome to Legal Briefs for HR . . . and Happy New Year!

The new year is a time for change (just listen to the election-speak!) and resolutions.  In case you were curious, the first LB4HR was sent in April 2000 to a small group of Dallas HR members who wanted to hear more about my visit (to lobby U.S. legislators in D.C.) than 5 minutes of “mic time” during a Dallas HR meeting would allow.  It grew into a tool to briefly convey new laws, regs, cases and other info to help those tasked with managing HR issues.  The scope of distribution has also grown, by word-of mouth (and click of mouse), to over 3600 subscribers in nearly every U.S. state and even a few overseas. 

In the spirit of the new year, I resolve to [1] send information that helps you do your job and avoid the mistakes that others have made; [2] keep it short; [3] speak plainly; and [4] laugh whenever possible.  If there’s something I can do differently that adds to the value of the tool, let me know.  I’m all ears.

To that end, here’s what’s up:

1. Get REAL – Today, the U.S. Dep’t of Homeland Security (DHS) issued its final rule setting security standards for state-issued drivers’ licenses and other ID cards, to combat the twin troubles of terrorism and identity theft. By 12-31-09 (or 5-10-11, if an extension is granted), states should upgrade [1] the issued credential; [2] the verification process before a credential issues; and [3] the security of their systems for producing and issuing credentials, as detailed in the 284-page final rule. For a quicker summary of the requirements, go to www.dhs.gov and click on the press release and Questions & Answers. The REAL ID program is not a mandate, but unless you’ve got one (or can produce a valid passport) you can’t board a commercial aircraft or enter a federal facility, starting in 2014.

2. Supremes’ Greatest Hits? – All eyes are on the Supreme Court, after it agreed to consider whether the Americans With Disabilities Act (ADA) requires an employer to provide a disabled worker reassignment to a vacant position preferred by the worker, when that worker is not the best qualified candidate for the job. The worker sustained an arm/hand injury that left her unable to fill orders in a grocery. She asked to be reassigned to a vacant router job, with equivalent pay, but was told she could apply and compete with others who were interested in the job. She was not picked, but did take a maintenance job with lower pay. At trial, she agreed that she was not the best qualified candidate for the router job but argued that the ADA requires preferential treatment of a disabled individual in order to effect an accommodation. The trial court granted summary judgment for the employer and the circuit court affirmed, saying “[T]he ADA is not an affirmative action statute” and does not require reassignment where it “would violate a legitimate nondiscriminatory policy of the employer to hire the most qualified candidate.” We’ll see if the Supremes agree. Huber v. Wal-Mart Stores Inc. (cert. granted 12-7-07).

3. What’s Your Definition of “Soon?” – In June 2007, the 3rd Circuit ruled that the EEOC had the authority to create an exemption from ADEA (age discrimination) claims to protect employers who alter, reduce or eliminate retiree health benefits when the covered retiree becomes eligible for Medicare or a similar state-sponsored plan. The EEOC had tried to implement the new rule in the summer of 2003, but AARP got an injunction. After the court issued its decision and dissolved the injunction, employers withheld champagne toasts waiting for the EEOC, which was expected to reissue the final rule soon. It did, on Dec. 26. Go to www.eeoc.gov for a press release and a copy of the new regulation. Go ahead, clink your glasses, the wait is over!

4. Contractor Conundrum – It’s your worst nightmare. The “contractor” who worked for your organization for years dies, and the IRS comes after his estate for failure to pay nearly $100,000 in taxes. The family has no money so they sue your company, claiming he was really an employee and you should’ve been withholding and remitting taxes to the IRS (and paying overtime and offering him employee benefits, too.). In this case, the court denied the family’s claim, relying on several key facts – [1] the decedent’s tax filings proclaimed he was a self-employed computer consultant; [2] while working for the defendant, he sought work from other companies; and [3] the work performed by the decedent was not integral to the product/service offered by the defendant employer (i.e., they were in the business of providing health insurance coverage, not computer programming or system design). While the test(s) for employee vs. contractor status can vary, depending upon the jurisdiction and the statute(s) at issue, the observations made by this court tend to show up again and again. As always, the terms of a written agreement are not determinative. Just because both parties want an independent contractor relationship and say so, in writing, it ain’t necessarily so. Structure these arrangements carefully. Estate of Anthony J. Suskovich v. Anthem Health Plans of Virginia, Inc. (S.D. Ind. 12-10-07).

5. It’s Not Your Imagination – The U.S. Dep’t of Labor has stepped up enforcement activity and their EOY numbers prove it. The 341,624 workers who received backpay during fiscal year 2007 represents the 2nd largest number since 1993 and the amount collected, $220,613,703.00, is the largest amount for a single year. Per the 12-28-07 press release, US DOL collected $1.25 billion for nearly 2 million workers since fiscal year 2000.

6. They’re Not the Boy Scouts – In this case, BSA stands for Business Software Alliance and they are on a mission to identify and stop illegal software copying, distribution and use. A November 2007 Associated Press article explained that BSA is “the main copyright-enforcement watchdog for such companies as Microsoft Corp., Adobe Systems Inc. and Symantec Corp.” and their favorite target seems to be small businesses that lack the “technological, organizational and legal resources to avoid a run-in.” Just check out their website (www.bsa.org) which has a “Report Piracy” link that offers up to $1 million to those who turn in others for unlicensed software violations. Not sure if you’re in the clear? Then click on their “Tools and Resources” link for help. Be Prepared is a good motto!

7. Fun With FMLA – How important is giving employees prompt written notice that their FMLA allotment is being reduced during an absence? If the lack of notice causes “actual prejudice” to the worker, there is interference with FMLA rights and damages are available. Where a worker had a series of FMLA-qualifying absences that exhausted her FMLA allotment, and upon return from knee surgery she was reassigned to a new job that meant loss of a company car and no more overtime, there was actual prejudice. She successfully argued that had she known she was about to use up all job-protected leave, she could’ve deferred elective knee surgery into the next FMLA 12-month period and been entitled to reinstatement to her former job. The court agreed and the 5th Circuit did, too. The devil is in the details, so keep those records up-to-date and send out the Form WH-381 within two business days. Downey v. Strain (5th Cir. 12-12-07)

8. More Fun with FMLA – There’s a snag with the bill (H.R. 1585) that would expand FMLA to mandate 12 weeks of leave to the family members of U.S. military service personnel who are called to active duty (to see them off) and 26 weeks of leave to care for them if/when they return home injured. The bill went to President Bush for signature on Dec. 19, but on Dec. 28 he announced that he would veto, due to concerns with an unrelated provision in the bill which allows lawsuits against the Iraqi government. The bill had enough support in Congress to override a veto (2/3 majority in each chamber), but the other shoe won’t drop until Congress convenes in mid-January. Stay tuned!

9. Simply the Best – The Dallas Business Journal is now accepting on-line nominations for its annual DBJ Best Places to Work in Dallas/Fort Worth event! Just go to www.dallasbusinessjournal.com, scroll down to mid-page and click on the link under “Events and Networking” for a description of eligibility requirements and a on-line form to complete. Don’t miss this opportunity to proudly proclaim that your organization is among the best places to work in the Metroplex! The deadline for nominations is Jan. 21, so get to clickin’!

10. Coming Soon – I look forward to two upcoming speaking engagements. The first will be a legal/legislative update on Jan. 22 at the Belo Mansion for the Dallas chapter of the Association of Legal Administrators. For registration info contact LaDee Donaldson at lddonaldson@jonesday.com. The second will be on Feb. 21 at the Crowne Plaza (on Midway) for the Dallas chapter of the Texas Association of Business. The topic will be managing the tech-toys that were supposed to save businesses time and trouble but, instead, are behind a loss in worker productivity, increased litigation and a legislative backlash to protect individual privacy. For more info, contact me (hit “reply”) or Monna Miller (mmiller@txbiz.org) and we will send you a registration form.

11. Coming Later – Yours truly will present four webinars on behalf of the Bureau of National Affairs (BNA). Mark your calendar for April 24 (Achieving Diversity Without Buying a Lawsuit), May 1 (Don’t Mess with Texas [Employers]: A Legal and Legislative Update), June 19 (Website Wonderland: HR Resources on the Internet) and July 24 (Babes in Tech-Toy Land). All webinars are from 1 to 2:30 CT.

Until next time,

Audrey E. Mross
Labor & Employment Attorney
Munck Carter LLP
600 Banner Place Tower
12770 Coit Road,
Dallas, TX 75251

972.628.3661 (direct)
972.628.3616 (fax)
214.868.3033 (cell)
amross@munckcarter.com
www.munckcarter.com