Keeping FLSA Settlements Confidential: Far From a Slam Dunk

on Feb 05 in Class/Collective Action, New Jersey, Wage/Hour tagged by Michael Tiliakos

There are a handful of certainties in life: death, taxes, the Yankees in the
post-season, and the desire of an employer faced with
an FLSA collective action to condition a settlement on some sort
of confidentiality. Most employers involved in a settlement of
an FLSA action want the plaintiffs to keep the settlement
confidential to avoid copycat lawsuits from other employees who may view a
settlement as an admission of wrongdoing by the employer. In a recent decision
from the U.S. District Court for the District of New Jersey, an employer
- Camin Cargo Control – sought to file a settlement agreement in a
wage and hour case under seal. The employer argued that revealing the
terms of the settlement would place it in a competitive disadvantage and damage
its business reputation because the monetary payment to plaintiffs would send a
message of wrongdoing. Plaintiffs did not oppose the application to file the
settlement agreement under seal. The Court, relying on a broad consensus among
courts that FLSA settlements are different than “ordinary”
settlements, and a strong presumption in favor of keeping FLSA
wage settlements unsealed and available for public view, refused to file the
settlement agreement under seal. Specifically, the Court held there was a
general public interest in making sure employee wages are fair and not
endangering “the national health and well-being,” and in seeing the content of
documents upon which a court based its decision (like whether to approve a wage
and hour settlement).

Employers should still seek confidentiality in wage and hour
settlements – but they must also be prepared to address a Court’s hesitation to
grant such relief (especially in a jurisdiction like New Jersey that
follows a strong presumption in favor of public disclosure).
Employers should, for example, be prepared to articulate the legitimate private
or public interests that warrant filing an agreement under seal and how
those interests outweigh public disclosure; clearly defining how the employer
would be injured if the settlement agreement were not filed under seal; and that
less restrictive alternatives (if any) are not available. The
case is Brumley
v. Camin Cargo Control Inc., and can be found here.

February 1, 2012 is the Deadline to Provide New York Wage Notices, and Other New York Laws to Keep Your Eyes on in 2012

on Jan 25 in Discrimination, Policies, Practice & Procedure, Reasonable Accomodation, Wage/Hour tagged by Anthony Rao

The February 1, 2012 deadline to provide wage notices to your employees in New York is fast approaching.  The forms can be found here.

Other 2012 new labor and employment laws and regulations to keep your eyes on that may affect your New York business are as follows:

-Under the Workplace Religious Freedom Act (WRFA) which amended the City’s Human Rights Law, it is harder for employers to meet the “undue hardship” defense with respect to reasonably accommodating the religious practices of an employee or applicant.  In short, the federal de minimis standard does not apply.  Rather, the WRFA defines “undue hardship” as “an accommodation requiring significant expense or difficulty (including a significant interference with the safe or efficient operation of the workplace or a violation of a bona fide seniority system).”  Various factors should be evaluated such as cost and the number of affected employees.  Generally, employers can establish undue hardship by showing that a requested accommodation will result in the inability of the employees to perform the essential functions of their jobs.

-The summary judgment standard for City Human Rights discrimination cases no longer requires a plaintiff to establish a prima facie case when a defendant presents evidence of a nondiscriminatory reason for its action.  The focus now is on whether plaintiff can prove the defendant’s reasons are pretext.  If the plaintiff responds with some evidence that at least one of the reasons proffered by defendant is false, misleading, or incomplete, “such evidence of pretext should in almost every case indicate to the court that a motion for summary judgment must be denied.”  Bennett v. Health Management Systems, Inc. 2011 WL 6347918 (N.Y.A.D. 1 Dept., Dec. 20, 2011).

-The “Employee Rights Under the National Labor Relations Act” Poster must be posted in nearly all union and non-union workplaces (with some exceptions) on or before April 30, 2012.  Frequently asked questions (such as the types of non-union employers with minimal interstate commerce that must comply) and the form notice can be found here.

-The U.S. Department of Labor Administrative Review Board voted that the whistleblower provision of Title VIII of Sarbanes-Oxley has no extraterritorial application.

-The Low Income Support Obligation and Performance Improvement Act requires employers to report whether health insurance benefits are available to employees’ dependents in their quarterly wage reports.

Supreme Court Recognizes a “Ministerial Exception” to Employment Discrimination Laws

on Jan 12 in Discrimination tagged , , by Anthony Rao

Today the Supreme Court unanimously held in Hosanna-Tabor Evangelical Lutheran Church & School v. EEOC, No. 10-553 (Jan. 11, 2012), that the First Amendment bars suits brought on behalf of ministers against their churches when those ministers claim termination in violation of employment discrimination laws.  In doing so, the Court validated the “ministerial exception” to employment discrimination laws, a principle long-recognized by federal appellate courts across the country.

The case was initiated by Cheryl Perich, a teacher employed by a school run by a large Lutheran denomination in Michigan.  Perich taught mostly secular subjects but also completed the church’s requirements to become a “Minister of Religion, Commissioned,” including theological study, endorsement by her local district, and passage of an examination.   She also taught religion classes and led school-wide chapel services.  After Perich became ill with narcolepsy, the school contracted with a non-commissioned teacher to replace Perich.  Perich attempted to return to work, and threatened to file a lawsuit against the school when she was refused her former position.  Perich was later terminated and her title as minister was rescinded.  The EEOC filed suit against Hosanna-Tabor on her behalf, alleging that Perich had been fired in retaliation for threatening to file a disability discrimination lawsuit.

The question before the Court was whether the Establishment and Free Exercise Clauses of the First Amendment barred Perich’s suit.   Writing for the Court, Chief Justice Roberts concluded that the history of the Religious Clauses and the Court’s precedents regarding them barred the government from interfering with the decision of a religious group to fire one of its ministers.  The Court also agreed with every federal appellate court in the country that there was a “ministerial exception” to prevent the application of Title VII and other employment discrimination laws to claims concerning the employment relationship between a religious institution and its ministers.  In this case, the Court held, Perich’s formal title and the religious functions she performed for the church made her a minister covered by the ministerial exception.

The Court rejected the EEOC’s argument that religious organizations can defend against employment discrimination claims by invoking their First Amendment right to freedom of association.  As Chief Justice Roberts noted, “The Court cannot accept the remarkable view that the Religion Clauses have nothing to say about a religious organization’s freedom to select its own ministers.”  The Court found that the issue in this case, “government interference with an internal church decision that affects the faith and mission of the church itself,” warranted the application of the ministerial exception.  While finding that the ministerial exception is not limited to the head of a religious congregation, the Court declined to “adopt a rigid formula” for deciding when an employee qualifies as a minister.

In concurring opinions, Justices Thomas and Alito offered two different approaches to the question of which employees may qualify as ministers.  Justice Thomas stated that the First Amendment requires courts “to defer to a religious organization’s good-faith understanding of who qualifies as its minister” to apply the ministerial exception.  In contrast,  Justice Alito, joined by Justice Kagan, urged courts to “focus on the function performed by persons who work for religious bodies,” rather than relying solely on the use of the term “minister,” because different religions use the term “minister” in different ways (and some do not use the term at all).

NEW YORK

90 Park Avenue, 18th floor

New York, NY 10016

Main: 212-455-9255

Fax: 212-297-0005

SAN FRANCISCO

201 Spear Street, Suite 1100

San Francisco, CA 94105

Main: 415-230-5334

Fax: 212-297-0005