Labor and Employment Update - Summer 2008

PRE-EMPLOYMENT SCREENING TESTS

Pre-employment screening tests (“PST”) are useful tools for evaluating job applicants and for making other employment related decisions, like promotions.  Obviously, there are many positive aspects to ensuring that your applicants, or employees, have the aptitude or skill requisite to handle the job for which they apply.  Carefully designed and diligently implemented aptitude, personality, objective or projective tests can establish whether a potential employee is a good fit for your company and a particular position.  In fact, Title VII of the Civil Rights Act permits employers to use PSTs to screen applicants. 

However, Title VII, as well as other state and federal laws, prohibit PSTs that are (1) discriminatory, or used as a pretext for discrimination; (2) insufficiently related to the applicant’s or employee’s job responsibilities; or (3) administered inconsistently.  Poorly designed PSTs can quickly become the subject of a lawsuit.  In fact, the Supreme Court of the United States has stated, “[t]he [Civil Rights] Act proscribes not only overt discrimination but also practices that are fair in form, but discriminatory in operation. The touchstone is business necessity. If an employment practice which operates to exclude [African-Americans] cannot be shown to be related to job performance, the practice is prohibited.”

Recently, Ford Motor Company (“Ford”) settled claims brought by applicants who were not hired on the basis of PSTs.  The plaintiffs alleged that the PST Ford uses for one of its apprenticeship programs had a disparate impact on African-American applicants.  In other words, the PST on its face was not discriminatory. However, in practice, the PST had a comparatively negative impact on African-American applicants’ ability to gain employment in the apprenticeship program.  Federal Express (“Fed Ex”) also recently settled a discrimination lawsuit where the plaintiffs claimed the “Basic Skills Test” that Fed Ex used had an adverse impact on minority employees.  

Discrimination lawsuits, based upon PSTs should be a concern for any company that makes hiring or promotion decision based upon PSTs.  There are several steps employers should take to avoid problems when using a PST:

·       consult your attorney;

·        have experts develop the PST;

·       use the latest version of any PST developed by an expert;

·       use a PST that has been shown to be related to the job in question;

·       ensure the tests are developed consistently with published professional standards;

·       have trained professionals administer and evaluate the tests;

·       confidentially maintain the PST data and use the data only for job-related purposes;

·       use PSTs in conjunction with other screening techniques;

·       obtain a job applicant’s or employee’s written consent before giving the PST.

NEW JERSEY ENACTS PAID FAMILY LEAVE LAW

On May 2, 2008, New Jersey Governor Jon S. Corzine signed into law the Family Temporary Disability Leave law (commonly known as the “Paid Family Leave” law), which requires New Jersey employers to provide six weeks of partially paid leave to eligible employees to care for a child within 12 months of the child’s birth or adoption, or to care for a family member with a serious health condition. “Family member” is defined as a spouse, civil union partner, domestic partner, parent or child. Unlike the federal law, the New Jersey law does not apply to the employee’s own illness.  The paid leave under this new law is to run concurrently with the leave provided under the federal Family and Medical Leave Act (the “FMLA”) and/or the New Jersey Family Leave Act (the “NJFLA”). 

The law is an extension of New Jersey’s current temporary disability insurance program, and thus applies to all public and private New Jersey employees subject to the New Jersey Unemployment Compensation law.  There is no 50 employee minimum threshold, as required under the FMLA.  For an employee to be eligible, the employee must have either: (1) worked 20 calendar weeks in covered New Jersey employment; or (2) earned at least 1,000 times New Jersey minimum wage during the one-year period before the leave.  In addition, to receive the paid leave, employees must provide certain advance notification to their employer.

Employees taking paid family leave under the new law will not receive the full amount of their pay, but instead may receive two-thirds of the employee’s average weekly wage, up to a maximum amount of $524 per week.  The program requires no contributions from employers, as it is 100% funded by employee contributions through payroll deductions on the first $27,700 earned (in 2008). 

State funding assessments will apply beginning on January 1, 2009.  Benefits under the act are accessible to employees beginning July 1, 2009.  Accordingly, New Jersey employers plan to offer paid family leave by July of 2009.   Although employers are not required to fund the benefits granted under the law, any potential administrative costs or work issues that may be affected by implementation of the law should be considered.

EMPLOYERS NEED TO BE CAREFUL TO AVOID “ASSOCIATION-BASED” DISCRIMINATION CLAIMS

Two recent cases serve as important reminders to employers regarding potential liability from discrimination claims that are based – not so much on an employee’s membership in a particular protected class – but rather on the employee’s relationship or association with a family member or close associate in a protected class.  This is sometimes referred to as “association-based” discrimination.

In Trujillo v. PacifiCorp, for example, the Tenth Circuit reversed a lower court’s grant of summary judgment in favor of an employer on a claim arising under the Americans with Disabilities Act (“ADA”).  In Trujillo, a married couple had been fired by their employer based on alleged time card fraud.  The couple subsequently sued, claiming that the true reason for the firings was the fact that their son was undergoing expensive cancer treatments, which created a financial burden for the employer.  Under the ADA, an employer is specifically prevented from discriminating against a qualified individual “because of the known disability of an individual with whom the qualified individual is known to have a relationship or association.”  The lower court dismissed the case on summary judgment, holding that the couple had failed to establish a prima facie case of discrimination under the association clause of the ADA.  The Tenth Circuit reversed, holding that the timing of the investigation in to the alleged time card fraud (where the investigation was commenced just eleven days after the son had begun expensive cancer treatments), coupled with the fact that other employees had been suspended without pay rather than terminated for time sheet violations, was enough for the plaintiffs to establish a prima facie case of association-based discrimination under the ADA.

While, as discussed above, the ADA contains an explicit provision preventing discrimination due to “association” with a disabled person, there is no analogous “association” provision in most other federal anti-discrimination statutes, such as Title VII or the Age Discrimination in Employment Act (“ADEA”).  Nevertheless, in Holcomb v. Iona College, the Second Circuit recently held in a case of first impression that a plaintiff may state a cause of action under Title VII based on the “employee’s association with a person of another race.”  In Holcomb, the plaintiff (who was white) had been hired as an assistant basketball coach for the men’s basketball team in 1995.  In or around June 2000, the plaintiff married Pamela Gauthier, an African-American woman.  In 2003, the plaintiff and an assistant coach who was African-American were both terminated, while another assistant coach who was white (and who was not involved in an interracial relationship) was retained.  The plaintiff claimed his termination occurred because he was involved in an interracial marriage.  Among other things, he introduced evidence of racially biased statements made by the Vice President of the College (including offensive statements allegedly made to him by the Vice President about his decision to marry an African American woman).  The college argued that there was no evidence of discrimination and that when three new coaches were hired for the program, one of them was African American.  The district court granted summary judgment in favor of the college, but the Second Circuit reversed, holding that Title VII does afford a remedy to employees who feel they have been discriminated against based on their “association” with a person of another race.  While acknowledging that the statutory language of Title VII covers only discrimination against an individual because of “such individual’s race,” the Court held that Title VII can cover discrimination against an individual because of his/her participation in an interracial marriage; in this regard, the Court opined that the discrimination is, in actuality, based on the employee’s race, as if he had been the same race as his wife, the discrimination allegedly would not have occurred.  The Court found that there were sufficient issues of material fact for the matter to be sent to the jury.

In both these cases, employees were able to proceed to trial by jury based on claims that the employer had discriminated against them based on the employee’s relationship with a close family member.  Employers need to be mindful of possible claims arising from an employee’s intimate relationships, as association-based claims will likely introduce another layer of complexity in personnel decisions.

The Labor and Employment Group represents and counsels employers in all aspects of the employment relationship, including EEO litigation, union avoidance, negotiations, arbitrations, executive compensation, corporate transactions, and non-competition/non-solicitation agreements, as well as compliance with federal and state laws such as the Family and Medical Leave Act, the Americans with Disabilities Act, the Health Insurance Portability and Accountability Act, the Fair Labor Standards Act and the Occupational Safety and Health Act.

This document is published for the purpose of informing clients and friends of Klehr Harrison about developments in the areas of labor, employment and benefits, and should not be construed as providing legal advice on any specific matter. For more information about this publication or Klehr Harrison, contact Charles A. Ercole, Chair of the Labor and Employment Group, at (215) 569-4282 or visit the firm’s Web site at www.klehr.com