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Labor & Employment Newsletter - October 2023

Date: October 4, 2023

Eleventh Circuit Joins Third, Seventh, and Ninth Circuits in Ruling That USERRA Requires Paid Military Leave When Employer Provides Paid Leave For “Comparable” Absences

By: Peter D. Guattery

A growing number of federal appeals courts are ruling that the Uniformed Services Employment and Reemployment Rights Act ("USERRA") requires employers to provide employees on military leave with the “same rights and benefits” as are provided to similarly situated employees on non-military leave.

USERRA is a federal law that protects veterans and military personnel from employment discrimination based on their service. The law specifically requires both public and private employers to allow their employees who serve in the military to take any necessary leaves of absence when called upon for military services. In some instances, the employer may provide paid or unpaid leave. A potential concern arises, however, when an employer provides short-term paid leave separate and apart from paid time off ("PTO") or vacation time, for absences for reasons other than military leave.   

In the case of Myrick v. City of Hoover, the Court of Appeals for the 11th Circuit ruled that where the military leave is comparable to other paid leave under USERRA, an employer may violated the non-discrimination provisions of USERRA if it does not provide paid leave to the employee on military leave. In so ruling, the court joins three other circuit courts in ruling that employers must give equal benefits – i.e. paid leave - to employees taking short-term military leave as they give those who take any other type of “comparable leave.”

Plaintiffs Thaddaeus Myrick and three of his colleagues were police officers for the City of Hoover, Alabama. They also served as reserve officers in the U.S. military; a duty that required them to take leaves of absence of varying lengths in order to fulfill their military duties. In addition to paid time off, which all employees accrue, the policy department also provided employees with separate paid leave for various other reasons, such as jury duty, formal city hearings, internal investigation and inclement weather.

USERRA requires employers to give employees on military leave the same “rights and benefits” provided to similarly situated employees on non-military leave. The officers sued their employer, claiming disparate treatment because the employer did not provide them with the same benefits it gave other employees on paid administrative leave. The District Court granted the officers summary judgment, and Hoover appealed the decision to the Eleventh Circuit, ultimately ruling in favor of the officers.

At issue was whether the paid administrative leave offered for jury duty, hearings and inclement weather, was “comparable” to the requested USERRA leave.  In deciding that it was, the court focused on three factors as determinative:

(1) the duration of the leave;
(2) the purpose of the leave; and
(3) the ability of employees to choose when they take leave.

The Court found it persuasive that the city was willing to provide its employees with “up to around sixteen months” of paid administrative leave, noting that interestingly, around sixteen months is “the same average length as the longest instances of military leave.” Secondly, the Court found the purpose of both leaves of absence to be similar in that they aim “to shield employees from unnecessary hardship” and/or to comply with the law. Regarding the third and final factor, the court found that military and administrative leaves involve a similar lack of control because “[m]ilitary employees do not control when they will be summoned for active-duty service, just as non-military employees do not control when Hoover will launch an investigation and place them on administrative leave.”

The Eleventh Circuit decision joins decision from the Seventh, Third and Ninth Circuit, finding discrimination against employees on military service where it offered paid leave for some short term absences (such as jury duty, bereavement and other types of paid leaves), but did not provide paid leave for comparable military leave.  Although the Fourth Circuit has yet to rule on this issue, given the trend in the case law, employers are advised to review their benefits and leave policies frequently to ensure compliance with USERRA and affirm they are resistant to any possible claims if their other benefits are not “comparable.”  

Change to Maryland’s Cannabis Laws Raises Questions for Employers

By: David M. Stevens

As of July 1st, Maryland law now permits the possession and use of small amounts of marijuana. Unlike some other jurisdictions that have decriminalized marijuana possession, Maryland’s new statute does not directly address the law’s consequences for employers and employees. In the absence of statutory language clarifying the law’s impact on the workplace, many Maryland employers have been left uncertain as to their ability to prohibit, or test for, marijuana use among their employees. 
 
Absence of Employment-Specific Provisions Leaves the Legal Landscape Unchanged
 
Prior to the new law’s enactment, Maryland employers were free to prohibit the use and possession of marijuana in the workplace, as well as to test for marijuana as part of a drug testing program, as long as the testing program complied with procedural requirements set by a state statute. The fact that the new law removing criminal penalties associated with the use of marijuana did not contain any provisions limiting employers’ discretion with respect to drug-related policies means that employers retain the same level of flexibility that was in place prior to the new statute taking effect. 
 
As a result, Maryland employers may continue to enforce policies that prohibit employees from working while under the influence of marijuana, or from possessing or using marijuana on the employer’s property. Likewise, Maryland employers that engage in drug testing may continue to include marijuana among the substances encompassed by a testing program. In doing so, employers must continue to comply with the mandatory procedures applicable to such screening programs, including use of a certified testing facility, issuance of required notices, and the opportunity for employees who test positive to obtain a re-test at their own expense. 
 
Practical Considerations Lead Some Employers to Reevaluate Policies
 
While the new statute does not compel a change to existing policies, a number of employers have used the discussion surrounding the new law as an opportunity to reevaluate their current drug testing program. The increasing prevalence of marijuana use among younger segments of the workforce, coupled with a tight labor market, has led some employers to conclude that the potential negative impact of testing programs on their ability to recruit and retain employees outweighs their benefits, at least with regard to positions that do not involve direct safety concerns. 
 
While the hiring and retention considerations that affect the decision of whether to utilize a drug testing program will vary from one business to another, the recent change decriminalizing marijuana use at the state level does not require employers to make a particular change in such programs, at least until such time as new legislation or court interpretations emerge. 
 
Further Legislation May Be on the Horizon 
 
Maryland employers should not assume that the current legal outlook will continue indefinitely. As noted above, other jurisdictions that have decriminalized marijuana use have enacted specific provisions that prohibit employers from making employment decisions based upon an employee’s off-duty use of marijuana, and it is possible that similar legislation may be taken up by the General Assembly in future legislative sessions. Employers are encouraged to consult with legal counsel both to monitor any future developments on this front and to ensure that their existing policies with respect to drug testing are compliant with current Maryland law.  

An Early Report on How The Supreme Court’s Affirmative Action Admissions Policies Decision Is Impacting The Private Sector

By: Randi K. Hyatt

Introduction
In Students for Fair Admissions v. Harvard, 600 U.S. ___ (June 29, 2023) (SFFA), the United States Supreme Court struck down the legality of affirmative action programs within the university setting, holding that universities may not use race by itself as a “plus factor” in college admissions decisions.  Without delving too deeply into the legal nuances of the 237-page decision, the Court’s majority opinion noted the following important points: (1) because of the “zero sum” nature of university admissions, it is not possible for race to be a “plus factor” for some applicants without functioning as a detriment for others; and (2) using race as a plus factor inevitably invokes impermissible race stereotyping.[1]  It took only moments before the ripples of this decision were felt across both the public and private sector.

Following the ruling, legal experts predicted years of litigation and discourse regarding affirmative action in workplace hiring across a wide range of industries and business sectors.

One organization, America First Legal (founded by Trump former advisor Stephen Miller) declared to “Woke Corporations, Law Firms and Hospitals” that it deemed “all DEI programs and workplace balancing based on race, national origin, and sex violate the law.”  Its website contains a robust list of Press Releases touting its efforts in this regard including sending a cease and desist warning letter to Price Waterhouse Coopers demanding they stop using racial preferences in hiring and internship programs, with similar letters to a plethora of medical and law schools.

Shortly after the SFFA decision, the State Attorney Generals in thirteen (13) states[2] sent a letter to Fortune 100 companies setting out their interpretation of the decision and its application to private employers.  Although this AG Letter does not have the force of law, it provides telling perspective for companies that engage “in a laundry list of activities that these Attorneys General have deemed violative of the constitutional framework set forth in SFFA.”[3]  

Ironically, perhaps, Law Firm diversity efforts are at the forefront of the attacks being levied by elected officials and advocacy groups.  Senator Tom Cotton of Arkansas sent a letter to 51 law firms about what he considered the likely unlawfulness of their DEI programs and went so far to instruct the law firms of their “duty to fully inform clients of the risks associated with making employment decisions based on race.”  Id. 

From there, it did not take long for numerous law firms to be called out regarding DEI initiatives and programs.  The American Alliance for Equal Rights ("AAER") sued Perkins Coie LLP and Morrison Foerster LLP separately in federal courts (Dallas and Miami respectively) claiming their fellowship programs dedicated to minorities were unlawfully discriminatory against white applicants.  In response to the litigation, Morrison Foerster removed language from its fellowship program specifying that is only open to Black, Hispanic, Native American or LGBTQ applicants.[4]  AAER’s head, Edward Blum, maintains that “[l]awyers should know that the law does not permit racial discrimination in order to achieve proportional racial outcomes in any profession.”[5] 

The American Bar Association ("ABA") has condemned these attacks, reminding that the legal profession has a long way to go as far as having a diverse workforce.  ABA President Mary Smith noted that just 6% of lawyers are Hispanic (despite making up 19% of the U.S. population) and only 5% of lawyers are Black, while they make up 15% of the population.[6] 

What’s Next For Workplace Diversity Efforts?

The SFFA decision may (and already has) emboldened individuals and interest groups representing the majority to believe there is now a better chance of “reverse discrimination” claims being successful, or audits being conducted which may reveal discriminatory layers within DEI-labelled initiatives.  That should provide ample incentive for businesses to prepare.  That said, the actions that many are lamenting are “discriminatory” are typically not present in most employer DEI programs.

Racial quotas and preferences in hiring, recruiting, retention, promotion, and advancement are almost never components of such programs, which instead focus on increasing overall cohesion, sensitivity, belonging, inclusion, and equity in the workplace.[7] 

Moreover, on the same day of the SFFA decision, the Equal Employment Opportunity Commission ("EEOC") issued a press release declaring that the SFFA decision “does not address employer efforts to foster diverse and inclusive workforces or to engage the talents of all qualified workers, regardless of their background.  It remains lawful for employers to implement diversity, equity, inclusion, and accessibility programs that seek to ensure workers of all backgrounds are afforded equal opportunity in the workplace.”

While the SFFA decision will certainly influence on some level how private employers structure/restructure their DEI programs, policies and practices, employers must remember that the Supreme Court decision focused on factors unique to the university admissions process, particularly the “zero-sum” nature of the college admissions process.  Further, employers that are federal contractors may have obligations under the Office of Federal Contract Compliance Programs ("OFCCP") to maintain affirmative action programs for women, minorities, individuals with disabilities, and veterans. See Executive Order 11426.

Final Thoughts

The following recommendations will help employers remain compliant with anti-discrimination workplace requirements and mitigate being targeted because of DEI processes:
 
  • Define diversity in a very broad manner.  Diversity is much more than just race or gender (or other protected characteristics).  Diversity may include familial status, education level, languages spoken, volunteer experiences, work experience, and so on.  Diversity is much more than what is written in a statute.
     
  • Ensure your hiring process is accessible.  Expand your geographic reach, utilize different sources for referrals, and ensure job descriptions are crafted with accessibility in mind.
     
  • Engage your employees.  Evaluate and implement programs that are open to all employees and encourage mentorship, sponsorship, training, and advancement.  Employee Resource Groups or Affinity Groups ("ERG") remain appropriate.  While the focus of such groups may be on certain categories of employees (working parents, LBGTQ+, and the like), membership should be open and encouraged for all who are interested, regardless of their personal match to the title or mission of the group.
     
  • Prioritize workplace training.  Regular and timely training on discrimination, harassment and retaliation remains important.  Other trainings on diversity, equity, inclusion, cultural competency, and unconscious bias will benefit the culture and environment in a way that is very relatable and less “legal”.
     
  • Communicate consciously on DEI.  Review communications to ensure they are consistent with the messages intended and do not unintentionally deliver and exclusionary or limiting message or focus. 
 
[1] See Impact of U.S. Supreme Court’s Affirmative Action Decision on Private Employer DEI Programs and Recommendations for Employers, Husch Blackwell, (July 31, 2023). 
[2] In order of signature: Kansas, Tennessee, Alabama, Arkansas, Indiana, Nebraska, Iowa, South Carolina, Kentucky, West Virginia, Mississippi, Missouri, and Montana.
[3] See Impact of U.S. Supreme Court’s Affirmative Action Decision on Private Employer DEI Programs and Recommendations for Employers, Husch Blackwell, (July 31, 2023).
[4] See US Law Firm Alters Diversity Fellowship Criteria After Lawsuit, Reuters, by Nate Raymond (Sept. 6, 2023). 
[5] Id. 
[6] See Law360, ABA Condemns Attacks on Law Firm Diversity Efforts, by Xiumei Dong, accessed Sept. 5, 2023.
[7] See Impact of U.S. Supreme Court’s Affirmative Action Decision on Private Employer DEI Programs and Recommendations for Employers, Husch Blackwell, (July 31, 2023).

Supreme Court Toughens Standard In Religious Accommodation Cases

By: Peter D. Guattery

This past June, the Supreme Court issued a decision “clarifying” the test applied to determine when an employer would be justified in refusing a requested religious accommodation. Under Title VII, an employer may not discriminate against an employee or applicant on account of their religion. In regulations issued not long thereafter, the EEOC added its interpretation that this non-discrimination provision also required an employer to “make reasonable accommodations to the religious needs of employees” whenever those accommodations would not work an “undue hardship on the conduct of the employer’s business.” This interpretation was then adopted by Congress when it amended the statute in 1972. The term “religion” was also further defined to include “all aspects of religious observance and practice, as well as belief.” 
 
Two years after the statute was amended, the case of Hardison v. Trans World Airlines, set the standard for determining undue hardship in a religious accommodation case. That case involved a requested religious accommodation that was inconsistent with a unionized employee seniority system. In rejecting the claim under the particular facts of the case, the Hardison court stated:  “To require TWA to bear more than a "de minimis" cost in order to give [the employee] Saturday’s off is an undue hardship.” This low threshold for showing undue hardship came to be viewed as the applicable standard for evaluating an employer’s undue hardship defense. 
 
In a unanimous decision, the full court agreed that the “de minimis” standard was not the correct standard for assessing whether an employee’s religious accommodation request imposed an undue hardship. Instead, the Court concluded that “undue hardship” would be established where an employer could show that the burden imposed by the accommodation was “substantial in the overall context of an employer’s business.” In a concurring opinion, Justice Sotomayor, joined by Justice Jackson, sought to further clarify the kind of evidence the Court considered appropriate in considering the scope of evidence that could satisfy this standard.
 
Precisely how this new standard will be applied is an open question. The Court rejected the argument that undue burden means “significant difficulty or expense.” Yet they noted that an accommodation must be more than a “mere burden,” or “entail suffering or privation.” Just showing that an accommodation imposes additional costs, however, will not be sufficient. “Undue,” in the opinion of the Court, means that the burden must be “excessive” or “unjustifiable” on some level. From this, the Court concludes, with slightly different wording, that the employer must show that “the burden of granting an accommodation would result in substantial increased costs in relation to the conduct of the particular business.” In short, every case will be heavily fact based, with the lower level courts sorting through what factors are most relevant to the inquiry. 
 
From the point of view of the opinion of the court, the analysis would require taking into account all “relevant factors” including the accommodations at issue and their practical impact in light of the nature, size and operating costs of the employer. Not all impacts on coworkers, however, would be “relevant.” Only those impacts that affect the operation of the business would be relevant to assessing undue hardship. Still, the burden is on the employer to accommodate, which means it must look at all options and not just a singular cost or rejecting mandated overtime costs. In a situation such as Groff’s, where he was unable to work Sundays, voluntary shift swapping may be an option.
 
The concurring opinion focused on the scope of the phrase “conduct of a business.” In Justice Sotomayor’s view, this term would include “the management and performance of the business’s employees, and, therefore, the hardship determination must also focus on the employees and their respective rights in the workplace.” While some labor costs incurred by an accommodation may be too insubstantial, a hardship on employees may be sufficient to meet the required showing. 
 
There are other defenses to a claim of religious accommodation, including the introduction of evidence which may call into question the sincerity of an employee’s clamed religious beliefs. Proof of this defense requires evidence that would undermine what is essentially an employee’s subjective belief.  The “de minimis” standard was a more effective tool for employers to reject accommodations that were inconvenient or sufficiently costly that the employer did not want to bear the obligation to grant the request. Under the new “clarified” standard put forward in Groff, employers will need to more carefully consider all factors bearing on an accommodation request, and carefully weigh any additional costs or obligations before it rejects an employee’s request.    

The Pregnant Workers Fairness Act: What Employers Should Know
 

By: Caitlin Turner-Lafving

On June 27, 2023, the Pregnant Workers Fairness Act (“PWFA”) became law, placing heightened obligations upon employers to accommodate pregnant employees. The Equal Employment Opportunity Commission (“EEOC”) immediately began accepting charges under the PWFA for alleged violations occurring on or after June 27, 2023.

The primary impact of the new law is that under the new PWFA, employers are required to make affirmative efforts to accommodate a pregnant employee, not merely agree not to discriminate.

That is, under the PWFA, covered employers must provide reasonable accommodations to employees and applicants with known physical limitations related to pregnancy, childbirth, or related medical conditions, unless the accommodation would impose an undue hardship on the employer’s operations. Covered employers include private and public sector employers with more than 15 employees, as well as Congress, federal agencies, employment agencies, and labor organizations.

The PWFA prohibits covered employers from:
 

  • Requiring an employee to accept an accommodation other than any reasonable accommodation arrived at through an interactive process;
  • Denying a job or other employment opportunity to a qualified employee or applicant based on the person’s need for reasonable accommodations;
  • Requiring an employee to take leave, whether paid or unpaid, if another reasonable accommodation can be provided that would allow the employee to continue working; and
  • Retaliating against an individual for reporting or opposing unlawful discrimination under the PWFA.


Employers’ Expanded Obligations Under the PWFA

The PWFA expands employer obligations under federal law, requiring a greater effort to accommodate pregnant employees. Before the PWFA, a worker seeking accommodations for pregnancy, childbirth, or a related medical condition under federal law could do so through the Pregnancy Discrimination Act of 1978 (“PDA”), which amended Title VII of the Civil Rights Act of 1964, or the Americans with Disabilities Act (“ADA”). Under the PDA, which prevents discrimination on the basis of pregnancy, childbirth, or related medical conditions, a pregnant worker was required to identify a similarly situated employee who received an accommodation in order to obtain an accommodation of their own. Under the ADA, only certain conditions related to pregnancy, not pregnancy itself, qualify as a disability for purposes of obtaining reasonable accommodations. 

Under the PWFA’s increased obligation, any covered employee or applicant may simply request reasonable accommodations for pregnancy, childbirth, or a related medical condition. Furthermore, the PWFA mandates that employers engage in an interactive process with a qualified employee to determine a reasonable accommodation. These new provisions give workers with limitations related to pregnancy, childbirth, or related medical conditions streamlined access to accommodation in the workplace.

The EEOC’s Proposed Regulations Provide Guidance for Employers
           
On August 11, 2023, the EEOC published its proposed regulations for the PWFA. After a sixty-day public comment period, the agency will issue its final regulations. For now, the proposed regulations provide detailed examples of pregnancy-related medical conditions and reasonable accommodations for pregnancy-related conditions that employers may use as a guide.
 
Examples of pregnancy-related medical conditions include, but are not limited to, infertility and fertility treatment, high blood pressure, menstruation, use of birth control, and termination of pregnancy, including miscarriage.

With respect to reasonable accommodations, the proposed regulations identify four accommodations that the EEOC says “will, in virtually all cases, be found to be reasonable accommodations that do not impose an undue hardship.”  Titled “predictable assessments,” these are: (1) allowing an employee to carry and drink water, as needed, in their work area; (2) allowing an employee additional restroom breaks; (3) allowing an employee whose work requires standing to sit and whose work requires sitting to stand; and (4) allowing an employee breaks, as needed, to eat and drink. Other examples of possible reasonable accommodations include, but are not limited to, job restructuring, reassignment, schedule changes, paid or unpaid leave, temporarily suspending one or more essential job functions, providing reserved parking spaces, and allowing telework.

Employers’ Obligations Under State and Local Law

Importantly, many states, the District of Columbia, and some localities also require certain employers to provide reasonable accommodations for pregnant workers. Some state and local laws are even more expansive than the PWFA.

Since July 1, 2020, the Virginia Human Rights Act has required employers with 5 or more employees to provide reasonable accommodations to employees with known limitations related to pregnancy, childbirth, or related medical conditions, including lactation, absent an undue hardship on the employer.

In the District of Columbia, the Protecting Pregnant Workers Fairness Act of 2014 has long required employers to provide reasonable workplace accommodations for workers whose ability to perform the functions of a job are limited because of pregnancy, childbirth, breastfeeding, or a related medical condition, unless such accommodations impose an undue hardship. The law applies to all D.C. employers, regardless of size.

In Maryland, employers with 15 or more employees must make reasonable accommodations for an employee with a disability caused or contributed to by pregnancy, unless doing so would impose an undue hardship on the employer. The Reasonable Accommodations for Disabilities Due to Pregnancy Act, passed in 2013, requires employers to explore all possible means of providing reasonable accommodations for such a disability.

Localities can also mandate that employers provide accommodations for pregnant workers. Although Pennsylvania does not have such a law, both Philadelphia and Pittsburgh have passed ordinances requiring employers to provide reasonable accommodations for the needs of employees due to pregnancy, childbirth, or related medical conditions.

Takeaways

In addition to new obligations under the PWFA, employers must ensure compliance with applicable state and local laws governing the provision of reasonable accommodations to workers with limitations related to pregnancy, childbirth, or related medical conditions. Additionally, employers should be on the lookout for the EEOC’s final PWFA regulations, which the agency is required to issue by December 29, 2023.

Recent Client Alerts
In case you missed them, you can check out our three most recent alerts by clicking below:

Client Alert: US Department of Labor Proposes Increased Salary Requirement for White Collar Overtime Exemptions

Client Alert: NLRB Sets New Standard For Evaluating Lawfulness of Handbook Policies

Client Alert: USCIS Announces New I-9 Form And Changes To Verification Procedures For Eligible Employers

Announcements

 

On 10/6, Betsy Davis speaks on “The Art of Self-Promotion” at the University of Richmond School of Law as part of its A Century of Women at Richmond Law event.

The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.