Labor and Employment News

Spring 2018 Published by the Ohio State Bar Association Labor & Employment Law Section Labor and Employment News

“Fair Share Fee” Fair No Longer

By Jonathan J. Downes, George S. Crisci, INSIDE and Scott H. DeHart, Zashin, and Rich Co., L.P.A. Improving Prevention in the Wake of #MeToo: What Will Really Move the Needle?...... 6 n ancient Roman mythology, Janus was the god of Important Labor and Employment endings and beginnings, traditionally associated Changes Tucked into Federal Tax Bill...... 11 with passages, doorways, and transitions. Janus Iis often depicted as having two faces — one looking An Emerging Trend? Second Federal Appellate to the future, and the other looking to the past. Court Changes Course, Finds Title VII Extends to Sexual Orientation Discrimination...... 14 Fittingly, the name “Janus” has now become associated with a court case that is poised to become one of the most Elections Have Consequences — The New NLRB....17 significant decisions in decades in the arena of public sector Recent Developments in the Duty to Bargain: collective bargaining. On Feb. 26, 2018, the U.S. Supreme What Unionized Employers Should Know...... 21 Court heard oral arguments in Janus v. AFSCME Council 31. The case challenges a union’s deduction of compulsory Opioid Abuse in the Workplace...... 23

(continued on pg. 2) #MeToo/# TimesUp: Sexual Harassment’s New Environment...... 25 Labor and Employment News

“agency fees” as unconstitutional riders.” Conversely, “fair share” fees — nonpolitical union services under the First Amendment. have been criticized as requiring related to collective bargaining. The Looking to the Past: What these non-members to subsidize Court upheld these agency fees in Are Agency Shops? the advocacy of an unwanted the public sector, relying on two representative, making these non- earlier decisions which had upheld The following is a discussion member employees “ forced riders.” similar programs for private sector of “fair share” fees and its legal employees.3 The Court explained, Ohio is one of 22 states that does underpinnings, providing however, that a union may not not have a “Right to Work” law context for the Court’s require non-members to fund its prohibiting agency shops. In Ohio, pending decision in Janus. political and ideological projects. 13.6 percent of workers (public Ohio’s collective bargaining law and private) are in bargaining In a follow-up decision in Teachers for public employees (Revised units that have a recognized union v. Hudson,4 the Court spelled out Code Chapter 4117) permits what as their exclusive representative. the procedural requirements unions is commonly known as an “agency However, only 12.5 percent of must follow to designate which shop.” In an agency shop, an Ohio’s workers report any union expenses are related to the collective employee may (but is not required affiliation, leaving approximately bargaining process, calculate the to) join the union which represents 56,000 workers who are presumably amount of any rebate to employees a ‘bargaining unit’ that includes paying “fair share” fees.1 for such expenses, and provide the employee’s position. Employees employees a process to object. Nationally, the union membership who choose not to join the union The case led to what is known as rate for public-sector workers (34.4 are not required to pay union dues, a “Hudson notice,” a requirement percent) is more than five times but must instead pay a “fair share that public sector unions provide higher than that of private-sector fee” or “agency fee” to the union. calculations of fees for nonmembers workers (6.5 percent). Roughly based on the expenses of the Under Ohio law, a public sector half of all union-represented previous year. Upon receipt of a union is the “exclusive representative” employees in the U.S. are working Hudson notice, non-members may of all employees in a bargaining in the public sector (7.6 million). “opt out” of paying the full union unit — the union has a duty to The leading public employee “fair dues, and pay only the reduced fairly represent both the union share” case is Abood v. Detroit Board amount calculated by the union. members and non-members during of Education.2 In Abood, the U.S. contract negotiations, grievance In Ohio, RC 4117.09(C) sets Supreme Court rejected a First proceedings, and arbitrations. “Fair forth detailed requirements for Amendment challenge raised by share” fees have been rationalized administering an agency shop public school teachers in Michigan. as a way of distributing the costs of within these constitutional At issue in Abood was an involuntary these activities among all employees boundaries, including: (1) delaying “agency shop” arrangement that who benefit from them, avoiding the start of fair share fees until required non-union members to what have been termed “ free completion of a probationary period pay a fee for “chargeable expenses” 2 Labor and Employment News

or sixty days following the start expressly “opt out” of full union largely inapplicable to the First of employment; (2) prohibiting dues. The Court held that when a Amendment issues that arise in the the fair share fee from exceeding union imposes a special assessment context of public employment. The the amount of dues; (3) requiring or dues increase levied to meet Harris majority also challenged the the Union to establish an internal expenses that were not disclosed analysis in Abood itself on several rebate procedure that conforms when the regular assessment was grounds. This extensive criticism with federal law to determine any set, it must provide a fresh Hudson of Abood was viewed by many as an rebate of expenditures in support notice and may not extract funds invitation to commence a lawsuit of partisan politics or ideological from non-members without their challenging the constitutionality of causes not germane to the collective affirmative consent. The Knox agency shops in the public sector. bargaining process; (4) establishing decision questioned whether Abood In 2015, the Court granted review a procedure for employees to object and Hudson were rightly decided, in Friedrichs v. California Teachers to the amount of the fair share fee but the Court stopped short of Association,7 to consider two primary and any rebate calculation; and (5) overturning its earlier cases. issues: (1) whether Abood should be establishing a procedure for religious- Two years later, in Harris v. Quinn,6 overruled and public-sector “agency based conscientious objectors to the Court held that Personal shop” arrangements invalidated make a charitable deduction in Assistants (PAs) who were hired under the First Amendment; and lieu of paying fair share fees. by participants in a state-run (2) whether it violates the First Looking to the Past: The Medicaid program to provide Amendment to require public Court Signals a Change homecare services could not be employees to affirmatively object assessed a “fair share” fee. The to subsidizing non-chargeable Courts — and especially the Supreme Court concluded that these PAs speech by public-sector unions, Court — are reluctant to overrule were not “employees” for purposes of rather than requiring that past decisions, based on the legal assessing a fair share fee, even though employees affirmatively consent principle of stare decisis. Courts often the state had passed legislation to subsidizing such speech. lay the ground work for overruling allowing the PAs to join a Union an earlier decision by questioning its The Supreme Court held oral and to negotiate under its public reasoning in a series of later opinions arguments on Jan. 11, 2016, and sector collective bargaining law. or dissents, waiting for the right all signs pointed to the same five case to serve as the “vehicle” for re- The Harris majority devoted several Justices from the Harris majority examining the disputed legal issue. pages of its opinion to harsh criticism issuing a decision to strike down of Abood and its underpinnings. The Abood. However, a month later In 2012, a majority of the nine Court’s majority first challenged on Feb. 13, 2016, Justice Antonin members of the U.S. Supreme Court Abood’s reliance on the private sector Scalia unexpectedly passed away. began hinting at their disapproval decisions in Hanson and Street, Without this crucial fifth vote of Abood. In Knox v. SEIU, Local because the constitutional analysis necessary to overturn Abood, the 1000,5 the Court revisited whether was thin or nonexistent and was Court was split 4-4. The Court non-members may be required to 3 Labor and Employment News

authorizations to be revoked by employees, indicating that employees may provide a written notice of dues revocation to their employers. • Third, employers should consider preparing in advance for written communications strategies with their employees’ union representatives, and should assess the extent of their obligations to “meet and discuss” or engage in mid- term bargaining post-Janus. • Fourth, some employers may feel inclined to communicate directly with employees about withdrawal from issued a one-sentence per curium A decision in Janus is imminent, union membership and decision that affirmed the Ninth but it may be decades before the revocation of existing dues Circuit’s ruling (upholding Abood, but full implications of the Court’s authorizations. Employers without precedent-setting effect). ruling are understood. In the should proceed cautiously meantime, employers should plan to avoid issues of “direct Justice Scalia’s vacant seat on and prepare for the altered legal dealing” and other potential the Court was subsequently and labor relations landscape that unfair labor practices. filled through the nomination may be left in Janus’ wake. and confirmation of Justice Janus’ effect on the dynamics of Neil Gorsuch, whose judicial Looking to the Present: public sector labor relations may philosophies have been closely Employer Considerations necessitate revisiting Ohio’s collective likened to those of his predecessor. bargaining law, not only to address Employers should begin now the nullified RC 4117.09(C), but Now restored to a full contingent to plan proactively, and work in also to reassess the viability of of nine justices, the Supreme Court collaboration with labor counsel to “exclusive representation.” Unions granted review in Janus — a case address the legal implications of a have an obligation under Ohio law that closely mirrored the Friedrichs Supreme Court ruling in Janus that to “fairly represent” all employees case. All eyes were on Justice strikes down “fair share” fees. — members and non-members Gorsuch when the Supreme Court • First, employers should alike. How this obligation will be held its oral arguments on Feb. 26, closely examine language in affected by Janus will likely be the 2018, but he remained silent and their CBAs regarding “fair subject of future developments. refrained from asking any questions share” and union dues and be that would have signaled his views Other states have enacted, or have prepared to act immediately; on the case. Nevertheless, many legislation pending, to address the predict that Justice Gorsuch will • Second, employers should responsibilities of unions toward join a conservative majority of audit their payroll systems employees who decline to pay dues. five justices to overrule Abood. and documentation of In Ohio, Representative Becker and dues authorizations. Many numerous co-sponsors introduced CBAs provide for dues HB 53 in February 2017 with the 4 Labor and Employment News

short title “[r]emove requirements Janus will also affect hundreds of Endnotes to join public employee union.” HB collective bargaining agreements 1Bureau of Labor Statistics, 53 proposes to eliminate the “fair (“CBAs”) covering Ohio’s public Department of Labor, January share” provisions in Ohio’s collective employees which contain “fair 19, 2018 10:00 a.m. (EST) news bargaining law and the “exclusive share” language and related release, USDL-18-0080. representation” responsibilities provisions discussing opt-out, dues 2431 U.S. 209 (1977). of public employee unions with authorization, and revocations. respect to non-members. The CBA language that pertains 3Railway Employees v. Hanson, 351 bill remains pending before the to “fair share” and to “agency U.S. 225 (1956) and Machinists Finance Committee in the Ohio shops” will be immediately in v. Street, 367 U.S. 740 (1961). House of Representatives. conflict with federal law. 4475 U.S. 292 (1986). Looking to the Future: The The long-term influence of Janus 5132 S.Ct. 2277 (2012). Implications of Janus on public sector unions, and on their ability to retain membership 6573 U.S. ____, 134 S. How might Janus reshape the and to fund negotiation and Ct. 2618 (2014). landscape of public employee contract administration activities, collective bargaining in Ohio? If, as 7Cert. granted, No. 14-915, 135 S. remains uncertain. Unions have many predict, the Court upends the Ct. 2933, 192 L. Ed. 2d 975 (2015). been planning and preparing for “fair share” fee for public employees, the possible impact of Janus. How the impact will be immediate and far- this possible change will play out, reaching. Thousands of Ohio’s state however, remains to be seen. and political subdivision employees are currently paying “fair share” fees. Zashin & Rich Co., L.P.A. (“Z&R”) has over 20 attorneys who specialize The most immediate impact will in labor and employment law with be that R.C. 4117.09(C) will be offices in Columbus and Cleveland, effectively nullified. That portion representing both private and public of Ohio’s public employee collective employers. Z&R represents its bargaining law sets out the detailed clients in labor negotiations, human procedural requirements that Unions resources matters, and civil service. must follow when assessing “fair share” fees from non-members. If the Court strikes down “fair share” fees in Janus, the legal principles underpinning R.C. 4117.09(C) will likely be unconstitutional.

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Improving Prevention in the Wake of #MeToo: What Will Really Move the Needle? By Bill Nolan, Barnes & Thornburg LLP

Little did employment lawyers (or It is hard to avoid the conclusion that companies that are committed to anybody) know less than a year ago efforts to comply with the law since following it have often avoided that sexual harassment would be the the U.S. Supreme “invented” the harassment related liability. legal issue of 2018, first and foremost sexual harassment claim in 1986 have It seems unlikely to continue to in our attention as to how we can at least in part failed.1 At least since I that relatively straightforward, as best represent our clients in the began practicing in 1989, the advice #MeToo causes legislative responses, face of unprecedented awareness of has been consistent — have a policy likely results in shifting attitudes workplace harassment issues. What that tells employees harassment is among third-party decision-makers, is unusual is that Employment Law prohibited and how to report it to and causes employers to rethink Issue No. 1 arises not in response to the company, train people from time their approach to preventing sexual a major statute (such as the passage to time on what that policy says, harassment. This article looks at six of the Family and Medical Leave respond promptly to complaints, strategies that have been prevalent Act if you were practicing in 1994) and dole out appropriate corrective in early 2018 and considers which or a landmark court decision. Rather, measures in light of the facts. While ones are likely to truly diminish the it is the result of a stunning series some training is better than others, amount of workplace harassment. of disclosures of misconduct by and while there can certainly be high profile men, leading to much judgment and nuance in investigating more focus on unreported and and responding to complaints, therefore unaddressed harassment the advice is straightforward and with “low profile” workers as well. 6 Labor and Employment News

Abolish the Arbitration of Harassment Claims

I have noted three types of legislative responses to #MeToo in particular. One is to ban the arbitration of harassment claims. Likely the most noted step in this regard is a Feb. 12, 2018 letter to Congressional leaders from the National Association of Attorneys General (NAAG), signed by all 56 of its members.2 arbitration clauses, which disserve a blanket statement that To summarize the general idea, the public interest by keeping both judges are better trained the letter reads in part as follows: the harassment complaints and to handle harassment [W]e ask for your support and any settlements confidential.… disputes seems misguided. leadership in enacting needed Federal and state lawmakers • Many workers are not legislation to protect the victims have introduced legislation along covered by arbitration clauses. of sexual harassment in the these lines. Microsoft has been (Estimates and studies workplace. Specifically, we seek to a noteworthy supporter of such vary widely. My anecdotal ensure these victims’ access to the legislative efforts,3 and some large observations and discussions courts, so that they may pursue law firms have announced they with colleagues suggest justice and obtain appropriate will not require summer associates that the higher estimates in relief free from the impediment to sign arbitration agreements circulation are quite high; of arbitration requirements. after such arbitration requirements the difference between fairly Access to the judicial system, became a media item.4 extensive anecdotal feedback whether federal or state, is a and the studies is striking.) fundamental right of all Americans. • Outlawing arbitration would That right should extend fully to Move the needle? A little. Certainly, not seem to address what I persons who have been subjected it’s possible that an arbitration clause, believe are the two central to sexual harassment in the by providing confidentiality, would behavioral causes of the workplace. Yet, many employers allow an employer and/or bad actors persistence of harassment – require their employees, as a it employs to stay under the radar underreporting by victims, condition of employment, to sign and perpetuate harassment. But: and under-self-regulation arbitration agreements mandating • While the purpose of this by harassers (in the face that sexual harassment claims article is not to debate of all policies and training be resolved through arbitration the merits of arbitration urging otherwise). instead of judicial proceedings.... agreements, I think most I do not see arbitration clauses as Victims of such serious misconduct readers would agree that the significantly changing the amount should not be constrained to pursue relative training of judges of harassment in our workforces. relief from decision-makers who and arbitrators, noted in the are not trained as judges, are not NAAG letter, is not a central Prohibit or Disincent qualified to act as courts of law, consideration in deciding Confidentiality of and are not positioned to ensure between the two modes of Harassment-Related that such victims are accorded both dispute resolution. There is Settlements procedural and substantive due plenty of variability in the Similarly, it has been suggested process. Additional concerns arise quality of judges and in the that confidentiality clauses in from the secrecy requirements of quality of arbitrators, but 7 Labor and Employment News

severance or settlement agreements creates a potentially interesting report harassment, it does not related to harassment complaints dynamic. In my experience, seem that harassment victims or claims protect bad actors and/or confidentiality provisions are the are generally looking to talk the companies that employ them by subject of very little discussion more about their situations. keeping bad behavior under wraps. — either with our clients or with Again, I do not think these The first significant legislative opposing counsel — in reaching legislative initiatives really go to the enactment in response to #MeToo such agreements. Some employee- core issues that result in persistent was this year’s H.R. 1, the Tax Cut side lawyers have suggested to me harassment 42 years after Meritor. and Jobs Act,5 which does not allow that prohibiting confidentiality a business to take a deduction for any clauses may make companies more Protecting Independent settlement, payment, or attorney fees likely to fight harassment related Contractors related to sexual harassment or sexual cases: if we can’t quietly resolve this Employment law protections apply abuse if the settlement or payment is claim we think we can win to avoid to employees. As readers of this subject to a nondisclosure agreement. the monetary and many other costs of publication know, whether or not litigation, we might as well fight it. The law probably raises more groups of workers are employees questions than it answers, and it entitled to the protections of wage/ seems likely that, if lawyers do hour laws, the National Labor Move the needle? Again, I say a not reach what they view as a safe Relations Act, discrimination laws, little, probably a little more than workaround, employers will just and a host of other laws is probably arbitration clauses. While there forego the tax deduction and continue the key employment issue of this may be some impact when it to have confidentiality clauses — not century (at least until now) as the comes to bad actors as intended: typically to cover up harassment, but prevalence of the single site, 40-hour rather to minimize the publicizing of • As with arbitration clauses, employee in our economy continues what the employer is willing to pay to there is nothing about it to diminish. It has been suggested avoid litigation. There is legislation I see addressing the two that some middle ground may be in pending in a number of states that core behavioral issues order,6 and as a policy matter that would simply prohibit confidentiality causing harassment. concept seems to make some sense. provisions, which of course would • I am not certain claimants even State lawmakers are looking at take away that strategic decision. want these laws or, in any event, protecting independent contractors Confidentiality clauses are routine to want to exercise any newfound in certain industries. For examples, employment lawyers (as are apparent freedom they may obtain under legislation introduced in New York, violations of them), but giving such laws that are passed. As the Models’ Harassment Protection complainants the opportunity to I listen to women talk about Act,7 would provide legal protection talk about their agreements certainly why women do not always for models, most of whom are

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independent contractors and not article but important to employment certainly the clients who have employees. Tennessee legislators practitioners generally, #MeToo a culture of respect and civility seek to extend similar protections to could be the beginning of a trend will experience fewer harassment freelance musicians, another group towards an “independent worker” problems. Indeed, they will probably where there are reports of harassing or other middle ground under laws experience fewer employment and worse behavior but who are designed to protect workers. law problems of all kinds. usually independent contractors.8 “Culture” Congresswoman Eleanor Holmes Norton and others have advocated Now we get into more practical Move the needle? When it comes protecting independent contractors approaches to improving harassment to employment lawyers, I say, just a in the gig economy. It seems likely prevention. I have been carefully little. Certainly, on the management that some such measures will pass. tracking everything I can possibly side we strive for relationships where If there is pre-existing consensus on can about harassment throughout we are business advisors and not discrimination laws, extending such 2018, and I must say there are a just technicians and, when we are protections to non-employee workers, lot of articles that are not saying successful in achieving that, we can at least from sexual harassment if anything different than we influence client culture in varying not other forms of discrimination, have been at least saying at least degrees. And effective training and may be politically achievable. since I started practicing. I am advice can incrementally move a not even going to offer a move- client towards a healthier culture the-needle rating on those. when that is needed. But for the most Move the needle? I say yes. part, we are going to be limited in One thing that lawyers and Providing a remedy to an ever- our ability to influence client culture. consultants are adding to the increasing group of workers who discussion is the importance of Mechanisms for do not otherwise have it is real “culture” in preventing harassment. Anonymous Reporting change. While I do not know of any This seems to me to be the most companies that decide, we are going to One development that strikes me common “add on” from lawyers to protect employees but allow mistreatment as receiving less attention than is the advice we have been giving for of independent contractors, employers warranted are apps and other tools literally decades. Have a culture who have significant numbers of that allow for anonymous reporting. where people are treated with respect, independent contractors would need As noted above, I believe that doors are open for discussion and to ensure their employment practices closing the reporting gap is key to people are comfortable walking extend to independent contractors. reducing actual harassment. Most through those doors, and better Independent contractors who companies — certainly most that harassment prevention will follow. quietly put up with harassment or work regularly with experienced quietly go away will no longer have There is little question that that is lawyers — are good at responding to. Less directly pertinent to this true. For management side lawyers, to harassment that is known to them. 9 Labor and Employment News

But I predict that judges, juries and is presented by HR or legal counsel Endnotes other decision-makers will expect or outside consultants, come with 1Meritor Sav. Bank v. Vinson, more of employers in rooting out their minds completely open to learn, 477 U.S. 57 (1986). harassment now unreported, whether challenge themselves, and change that is in expressly changed statutory their behavior where needed? Who 2Letter from States’ Attorneys or case law tests or just through the thinks that a mandated hour or General to U.S. Congressional application of inherent gray areas two can meaningfully change the Leadership (Feb. 12, 2018), http:// such as “severe and pervasive.” behavioral issues of underreporting www.naag.org/assets/redesign/ and under-self-regulation? Are files/sign-on-letter/Final%20 I have been telling clients they are most of these trainings even good? Letter%20-%20NAAG%20 going to need to get innovative Management lawyers, how are Sexual%20Harassment%20 and creative in finding harassment prerecorded videos your clients Mandatory%20Arbitration.pdf that employees are not currently are using that you’ve seen? reporting. Not surprisingly, a 3E.g., Brad Smith, Microsoft handful of apps and programs are Again, the current uproar results endorses Senate bill to address percolating up for this purpose — not from a change in the law or the sexual harassment, MICROSOFT look for Kendr, JDoe, Spot, Bravely, workplace – it results from what we ON THE ISSUES BLOG (Dec. We Said Enough, and Blind. have been doing for a few decades not 19, 2017), https://blogs.microsoft. Certainly it is easiest for a company completely working. I submit that we com/on-the-issues/2017/12/19/ to have a detailed report with all should move towards more frequent microsoft-endorses-senate-bill- names in front of it, but if we have and shorter training interactions. address-sexual-harassment/. learned anything in the technology That keeps the issue front and 4E.g., Staci Zaretsky, Biglaw Firm revolution, it is that we can learn a center, is more easily customized Tries To Force Summer Associates lot through aggregated small bits to particular groups and situations, To Arbitrate Sexual Harassment of information such as through the and seems particularly aligned with Claims, (Mar. 26, 2018, 12:02 social GPS Waze or online review what seem to be shortening attention PM), ABOVE THE LAW BLOG, programs, to name just two examples. spans. We also need to challenge https://abovethelaw.com/2018/03/ ourselves to address underreporting biglaw-firm-tries-to-force- and under-self-regulation in different summer-associates-to-arbitrate- Move the needle? Absolutely. To environments than the mandatory sexual-harassment-claims/?rf=1. me, such technology overcomes hour training, such as through focus the behavioral hurdle of non- groups not necessarily supervised 5Pub.L. No. 115-97 (2017). reporting, and from the management by HR or legal where people feel 6Seth D. Harris and Alan B. side I would encourage every freer to explore hard issues. Krueger, A Proposal for Modernizing employer to welcome information Labor Laws for Twenty-First- in whatever form and quantity it Century Work: The “Independent arrives in and seriously explore Move the needle? Definitely. Fresh Worker,” THE HAMILTON technological solutions to that. and new approaches to training PROJECT, (Discussion Paper Also, as such tools become more that get to the root behavioral 2015-10), (Dec. 2015) (http:// prevalent, at least should they issues seem likely to meaningfully www.hamiltonproject.org/ prove to be effective, decision- move the needle on the frequency assets/files/modernizing_labor_ makers’ expectations of companies of harassment in the workplace. laws_for_twenty_first_century_ to use such tools will increase. Bill Nolan is the Managing work_krueger_harris.pdf). Rethink Training Partner of Barnes & Thornburg 7A. 08752 (NY 2017) and LLP’s Columbus office, which he Here again is not a legal strategy but S. 07607 (NY 2017). opened in 2009, and works with a a practical one. Do we really think variety of employers to minimize 8HB 1984-SB2130 (TN 2018). that people coming to a training class their employee-related liability. at the direction of HR, whether it 10 Labor and Employment News

Important Labor and Employment Changes Tucked into Federal Tax Bill By Don Boyd, Ohio Chamber of Commerce

payment related to sexual harassment Late last year, H.R. 1, informally Sexual Harassment and or sexual abuse if such settlement or called the Tax Cuts and Jobs Act, Sexual Abuse NDAs payment is subject to a nondisclosure passed Congress and was signed by A key change that may impact the agreement, or attorney’s fees the President. While the overhaul decision-making process regarding related to such a settlement or of the U.S. tax code received much settlements in sexual harassment and payment.” Take note that it is not of the attention — it was a tax bill abuse cases removes the ability to just the settlement or payment after all — the bill also contained deduct any settlement in such cases amount but also all attorneys’ some key labor and employment if it is subject to a nondisclosure fees related to the settlement or changes that attorneys and agreement (NDA). Where previously payment. This could be a factor businesses need to be aware of. The an NDA was routinely included in negotiating settlement amounts changes center mainly around tax in any such settlement, businesses and even whether to settle at all. credits and deductions for certain will need to further weigh the benefits but will also impact how Further, questions remain as to costs and benefits of including an employers can treat settlements how broad this provision will be NDA. The change, contained in of sexual harassment claims. construed by the Internal Revenue 26 U.S.C. §162(q), clearly prohibits Service (IRS). Are general claims the deduction of “any settlement or

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releases and waivers nondeductible general business tax credit equal to percent of the FML wages paid to a under this if sexual harassment and a percentage of the wages paid. To qualifying employee. The credit can sexual abuse claims are not explicitly qualify, employers must offer at least only be received if the employer pays carved out? If multiple claims are two weeks of paid FML, as defined at least 50 percent of the employee’s settled in a single agreement, can under the FMLA in 29 U.S.C § regular pay, whether hourly or a business deduct a portion of the 2612(a)(1)(A)-(E) and § 2612(a)(3), salaried. However, if the employer settlement amount for claims that separate from any other type of leave pays FML wages at a rate higher would otherwise be deductible? such as vacation, personal, medical or than 50 percent, the business can sick leave. The FML must be offered receive an additional quarter percent Lastly, if a sexual harassment to both full and part-time employees, tax credit for each percent of wages or sexual abuse claim results in with part time employees receiving above 50 percent the employee is paid settlement, are all attorneys’ fees a pro-rata amount. A qualifying up to a maximum of a 25 percent incurred in the defense of the lawsuit employee must have been employed credit if the employer pays 100 attributed to the settlement and for at least a year by the employer percent. Tracking FMLA, this tax nondeductible or only those directly and must have made less than credit is available for up to 12 weeks attributable to the actual negotiation $72,000 per year. This number can per employee per year. The FML and settlement of the case? These are increase each year as it is tied to 60 credit is available for the 2018 tax all items where further clarification percent of the threshold for a highly year and will expire after the 2019 will be needed from the IRS. compensated employee designation tax year if not extended by Congress. Paid Family and Medical under the tax code, currently Fringe Benefit Deductions Leave Credit $120,000. Note that these employee and Exclusions qualifications are not for the The Family and Medical Leave Act employee to qualify for leave but for While not the typical bailiwick of (FMLA) provides eligible employees the wages paid by the employer for labor and employment attorneys, the working for employers with 50 or the FML to qualify for the tax credit. following are good items of which more employees with up to 12 weeks to be aware when advising clients, as of unpaid leave. The tax bill provides If all these qualifications are met for they could affect whether a business a new incentive for employers to both the employee and employer, will begin or continue offering offer paid family and medical leave the employer may receive a general certain fringe benefits and the value (FML) to employees by providing a business tax credit equal to 12.5 of those benefits to employees:

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• Moving expenses, except • The bill imposes a new 50 for members of the military, percent limit on the deduction are now generally taxable. for food or beverage expenses Previously, an employee could provided to employees at an claim a deduction, non- employer-operated dining itemized, for moving expenses facility, with the deduction when beginning a job in a phased out completely new location or an employer after the 2025 tax year. could pay or reimburse the • The bill clarifies that moving expenses as a tax- achievement awards, i.e. safety free fringe benefit. Now, awards, are taxable if they are an employee can no longer cash or cash equivalents such deduct, and an employer can as gift cards, meals, lodging no longer pay or reimburse or tickets. However, tangible moving expenses tax-free. property, like a t-shirt or mug, • Employers will no longer be is not taxable. Further, an able to deduct expenses in award that provides the ability providing tax-free qualified to select a piece of tangible transportation benefits to property from a range of employees. The benefit, if it options is treated as tangible qualifies, can still be tax-free property and not taxable. to the employee but is non- • Employees can no longer deductible by the employer. deduct unreimbursed business • Employees can contribute expenses under miscellaneous pre-tax dollars for commuting, itemized deductions. If the up to $260 per month, for employer reimburses the both transportation and employee, the reimbursement parking. However, if the is tax free to the employee. employer is providing the However, if not reimbursed, contribution it is no longer it is no longer deductible. deductible by the employer. Conclusion • Entertainment, amusement, While this list is not exhaustive, or recreation expenses or any it does provide an overview of the expenses used in connection key changes that businesses will with those activities can need to consider going forward. no longer be deducted. Further, it could lead to changes in Also prohibited are any settlement negotiations and fringe deductions for amounts benefits offered by many employers. paid for membership in any club organized for business, Don Boyd is the Director of pleasure, recreation or social Labor & Legal Affairs at the purposes. This is without Ohio Chamber of Commerce. regard as to whether the expense is directly related to or associated with the employer’s trade or business.

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An Emerging Trend? Second Federal Appellate Court Changes Course, Finds Title VII Extends to Sexual Orientation Discrimination By David J. Oberly, Marshall Dennehey Warner Coleman & Goggin

Why It Matters the current circuit split as to whether result of disclosing to a client that he Title VII encompasses discrimination was gay and for failing to conform to For years, courts across the country based on sexual orientation, further the “straight male macho stereotype,” have held in uniform fashion that increasing the likelihood that the which — according to Zarda — sexual orientation is not a protected U.S. Supreme Court will take up constituted unlawful sex stereotyping class under Title VII of the Civil the matter to issue a decisive ruling in violation of Title VII. Initially, a Rights Act of 1964. Just recently, on the cognizability of sexual panel of three Second Circuit judges however, the Second Circuit Court orientation discrimination claims ruled against Zarda, dismissing his of Appeals in Zarda v. Altitude under Title VII and provide a sexual orientation discrimination Express, Inc., No. 15-3775 (2d Cir. definitive resolution to this hotly claim on the basis that Title VII does Feb. 26, 2018), became the second contested issue of employment law. not explicitly prohibit discrimination federal appellate court in the span based on sexual orientation. of less than a year to reverse course The Second Circuit Ruling and explicitly hold that Title VII’s On review of the panel’s decision, the Donald Zarda worked as a skydiving protections extend to discrimination full en banc Second Circuit reversed instructor for Altitude Express. on the basis of sexual orientation. course and held that Title VII Zarda filed suit against his employer The Zarda decision is noteworthy, prohibits discrimination based on an alleging that he was terminated as a as the opinion substantially widens individual’s sexual orientation due to

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its status as an impermissible form of “sex” discrimination. In reaching this conclusion, the Second Circuit relied on three primary lines of reasoning. First, the court looked to the text of Title VII and found that sexual orientation discrimination constitutes a subset of sex discrimination because the employer’s disparate treatment is motivated, at least in part, on the employer’s consideration of the worker’s sex. In reaching this conclusion, the court highlighted the fact that because one cannot fully define a person’s sexual orientation without identifying his or her sex, sexual orientation is a function of sex. Logically, then, because sex is a protected characteristic under Title VII, it follows that sexual orientation is also protected under Title VII’s prohibition against discrimination “because of…sex.” this particular form of disparate Takeaways treatment runs afoul of Title VII’s Second, the court found that sexual With the Zarda ruling, the Second ban on gender stereotyping. orientation discrimination constitutes Circuit now becomes the second a subset of sex discrimination under a Lastly, the court found that sexual federal appellate court to expressly theory of gender stereotyping, which orientation discrimination constituted rule that Title VII extends to sexual prohibits employment decisions a subset of sex discrimination orientation discrimination in the predicated on assumptions about under a theory of associational workplace. The Zarda decision how individuals of a certain sex can discrimination, which posits that comes on the heels of the landmark or should be, including to whom an individual who is discriminated 2017 decision issued by the Seventh they should be attracted. In support against because of the protected Circuit Court of Appeals in Hively of this conclusion, the court relied characteristic of those with whom v. Ivy Tech Community College, No. on the prior U.S. Supreme Court he or she associates is actually 15-1720 (7th Cir. Apr. 4, 2017), precedent holding that employment being disadvantaged because of which marked the first federal decisions cannot be predicated on his or her own traits. As such, appellate decision to favor a more mere “stereotyped” impressions sexual orientation discrimination expansive interpretation of Title VII about the characteristics of males violates Title VII’s prohibition that includes sexual orientation as or females, and that discrimination against associational discrimination a protected class. In addition, these based on a failure to conform to because this particular form of two recent landmark rulings align sex stereotypes constitutes a form discrimination is motivated by the with the position maintained by the of unlawful sex discrimination employer’s opposition to romantic EEOC since 2015, which holds that under Title VII. As such, the court association between members of sexual orientation falls within the concluded, because sexual orientation particular sexes which, in turn, umbrella of Title VII’s protections. discrimination is necessarily rooted constitutes discrimination based With that said, there is a clear split in gender stereotypes about the on the employee’s own sex. among both the federal appellate proper roles of men and women, courts and our nation’s federal 15 Labor and Employment News

governmental agencies as to whether in turn, will allow for consistent its intent to focus on targeting Title VII extends to encompass application of the law across all and eliminating discrimination sexual orientation as a protection federal courts throughout the nation. against LGBT individuals in the class. In this respect, the Zarda ruling workplace as one of its top national At the present time, however, the conflicts with the current precedent priorities, as articulated in the issue of whether discrimination based maintained by nine federal appellate EEOC’s recently released 2018- on sexual orientation constitutes circuits, all of which maintain that 2021 Strategic Enforcement Plan. actionable sex discrimination Title VII does not include sexual under Title VII remains in a state Taken together with the substantial orientation discrimination. The of significant uncertainty. While shift in the cultural and social Department of Justice also holds a the majority federal courts of viewpoint of the nation as it relates similar view of Title VII, finding appeal continue to refuse to add to the issues of homosexuality, sexual orientation to be excluded sexual orientation to the list of sexual orientation, and gender from the protections of the nation's protections afforded by Title VII, identity in recent years, it is clear federal anti-discrimination statute. the combination of the recent Hively that scope of what constitutes Combined, the clear divergence of and Zarda opinions indicate that “sex” discrimination is evolving opinions that currently exists as to a momentous shift in the legal and expanding in rapid fashion. the proper scope of Title VII has landscape as it relates to protections Ultimately, however, until a definitive placed immense pressure on the U.S. afforded to LGBT employees in the ruling is issued by our nation’s Supreme Court to address the issue workplace may be right around the highest court, at least for the time and hand down a decisive ruling on corner. Critically, in both decisions being LGBT employees will continue the cognizability of sexual orientation the Second and Seventh Circuits to lack comprehensive affirmative discrimination claims under Title overturned prior, longstanding circuit protections across the country under VII. Importantly, the Second precedent that held that Title VII federal law against discrimination Circuit’s Zarda decision makes it did not extend to sexual orientation in the employment setting. substantially more likely that the discrimination in the workplace. nation's highest court will ultimately In addition, many states and accept review of the matter at some municipalities have enacted their own point in the future to provide a statutory protections against sexual definitive answer regarding the scope orientation discrimination. Moreover, of Title VII’s protections which, the EEOC has clearly indicated

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Elections Have Consequences — The New NLRB By Alan L. Zmija

As the Lutheran rule evolved, many During recent years, one of the most Lutheran Heritage Village facially neutral rules were found contentious issues before the National The basic guidelines to evaluate unlawful by the NLRB because they Labor Relations Board (NLRB or whether employer policies violated were deemed overbroad and thereby Board) has been the lawfulness of the NLRA was established in affected Section 7 rights. Many employer policies relating to employee Lutheran Heritage Village – Livonia.1 of the disputes centered upon the work rules. Much of this review The Board in Lutheran stated that Lutheran test as to whether employees centered upon provisions found in when evaluating policies, the first would “reasonably construe” the employee handbooks. Oftentimes, step was whether a rule explicitly employer language to prohibit the issue involved was not employees restricts activities protected by Section 7 rights. The NLRB General actually violating policies but for Section 7 of the NLRA.2 If it does Counsel issued a memorandum in the employer merely maintaining not then there must be an evaluation an effort to provide guidance as to facially neutral work rules that were as to whether: (1) employees would what policies and handbook language found to violate the National Labor reasonably construe the language would pass muster.4 Nonetheless, the Relations Act (NLRA). With a new to prohibit Section 7 activity; confusion and litigation continued. president and new appointments to (2) the rule was promulgated in the Board, past pronouncements The Boeing Company response to union activity; or (3) are being reexamined. the rule has been applied to restrict With the election of a new the exercise of Section 7 rights.3 president, the composition of 17 Labor and Employment News

the Board changed. Against this scrutiny in each case as to whether that the company’s maintenance background the Board issued its they would prohibit or interfere with of the “no camera” rule did not decision in The Boeing Company NLRA rights and, if so, whether constitute unlawful interference (“Boeing”).5 Boeing overruled the any adverse impact on NLRA- with protected rights in violation 13-year-old decision in Lutheran.6 protected conduct is outweighed by of the Act.17 The Board stated legitimate justifications. Category 3 the Boeing rule was to be applied In Boeing, the Board considered includes rules that the NLRB will retroactively to pending cases.18 the legality of an employer “no designate as unlawful to maintain camera” policy for its employees.7 Two lengthy dissents were submitted because they would prohibit or limit Boeing designs and manufactures in Boeing by Members Pearce and NLRA-protected conduct and the military and commercial aircraft McFerran. Member Pearce stated the adverse impact on NLRA rights and much of the work is highly new test established by the majority is not outweighed by justification sensitive or classified. It maintains a was essentially a how-to manual for associated with the rule.11 policy restricting the use of camera- employers’ intent on stifling protected enabled devices such as cell phones Boeing’s “no camera” rule was concerted activity.19 He stated the on its property. An Administrative evaluated as a Category 1 matter.12 new rule was an “incomprehensible, Law Judge applying the “reasonably In overruling Lutheran, the Board hodgepodge of factors that will be construe” standard in Lutheran majority stated that the “reasonably impossible to apply”.20 In a similar found the policy to be in violation construe” standard entailed a vein, Member McFerran stated that of the Act.8 The Board majority single minded consideration of the Board had a new majority but overruled the “reasonably construe” NLRA-protected rights and did this was not a reason for it to revisit standard enumerated in Lutheran not take into account any legitimate past decisions.21 She suggested that and stated it would no longer find justifications for the employer the Board should seek public input unlawful the mere maintenance rules.13 The majority found that in before setting forth a new policy.22 of a facially neutral employment the past, the Board had too often The majority decision looked more policies, work rules and handbook failed to give adequate consideration like rulemaking than adjudication.23 provisions based on a single inquiry.9 and weight to employer interests She also criticized the majority’s in the analysis of work rules. The decision as a jurisprudential jumble The Board replaced the Lutheran rule of Lutheran must be replaced of factors, considerations, categories standard, stating that when with an analysis that will ensure a and interpretive principles.24 evaluating a facially neutral policy, meaningful balance of employee rule or handbook provision that it A Future Course of Action rights and employer interests.14 would evaluate two things: (1) the The NLRA gives important labor nature and impact on NLRA rights Reviewing the rule,15 the Board rights to employees to join or not join and (2) legitimate justifications found that the employer’s justification labor organizations and to pursue associated with the rule.10 for it outweighed the employee rights actions which are consistent with in this matter. The Board specifically Employment policies, rules and those rights. On the other hand, noted the type of the company handbook provisions would be placed employers also have important involved and stated the “no camera” into one of three categories. Category property rights to maintain their rule was an integral component of its 1 includes rules the Board designated workplaces and operate their security protocols which are necessary as lawful to maintain either because businesses. The history of the Act has to maintain federal contractor the rule when reasonably interpreted been to balance these two competing accreditation status. Additionally, does not prohibit or interfere with interests. Oftentimes, with changing the rule helps prevent the disclosure the exercise of NLRA rights or the political administrations and of Boeing’s proprietary information, potential adverse impact on protected appointments to the Board the limits the risk that employees’ rights is outweighed by justification balance changes significantly to personal information will be released, with the rule. Category 2 includes reflect different philosophies. and limits the risk of a terrorist rules that warrant individualized attack.16 The Board concluded 18 Labor and Employment News

For over the past decade, the establishing three categories of rules Neither Lutheran nor Boeing is the issue of what work rules and that are not practical. Although solution to a very vexing problem – policies an employer can lawfully the Board states that future the answer may be in the middle. maintain has been the subject of pronouncements will delineate the For good labor policy, employers and fierce debate. With the rule of boundaries of the categories such employees should both have their Lutheran and its reliance upon an departmentalization only confuses rights fairly protected. Good labor employees’ “reasonably construe” the issue. The all-important policy insures labor peace. Where to standard, countless employer rules Category 1 rules still require an go from here? Perhaps, the Board and have been found unlawful based analysis of rules but substitutes the General Counsel will provide more on reasoning that they have been old “reasonably construe” standard balanced direction through future overbroad and adversely impact an with that of “reasonably interpreted” decisions or the issuance of formal employee’s Section 7 rights. It is or a balancing of rights being memoranda but that is doubtful. almost impossible to determine what outweighed by “justifications”. Maybe Member McFerran’s thoughts employees will or will not “reasonably that the Board resort to formal Boeing is only a thinly veiled construe.” Employees are not fungible rulemaking and allow public input pronouncement by a new Board that nor are their thought processes. is worth investigating. Whatever will shift the balance significantly General all-encompassing well- the solution the final policy should to the employer. If the analysis meaning work rules, which have the be fair, simple and evenly balanced employed by the Board majority virtue of consistency and simplicity, so that we do not have a wide shift is followed in future decisions it were often found unlawful as well. in what is lawful with each new basically announces that absent political administration. Elections The Lutheran standards were very compelling facts, employer have consequences, but the rule unworkable when applied to the work rules will be found lawful of law should not change without modern American workplace. Good unless they specifically impact an broad input and serious evaluation labor policy requires that standards important employee’s Section 7 and deliberation. Boeing failed be fair, balanced, consistent and right. Much as a Lutheran analysis that test. Management, labor and to the greatest extent possible could almost always find some the rule of law deserve better. establish bright line boundaries “reasonable construction” to find so that all parties know what is work rules too broad and unlawful, Author's Note lawful.25 Obviously, such standards Boeing will easily permit findings are not easy to establish. The that “reasonable interpretations” As this publication was going to new Board attempted to establish justify employer work rules or that press, the NLRB General Counsel’s workable standards in Boeing, but affected employees Section 7 rights Office issued Memorandum GC that effort has failed as well. are not significant when balanced 18-04 on June 6, 2018 on the against the employer’s rules. subject of “Guidance on Handbook Boeing only muddies the already Rules Post-Boeing.” Because of cloudy water of Lutheran by 19 Labor and Employment News

the constraints on time, the new The reader is encouraged to review 7The Boeing Company, 365 NLRB material could not be incorporated the G.C. Memorandum and make No. 154 (2017). The policy is into the article and the reader is their own assessment of these designated PRO-2783. The advised to review the Memorandum important policies but this author rule itself is too lengthy to be for the latest G.C. interpretation believes that the implementation of included in this note but can be of policies on this matter. guidelines regarding the lawfulness found at p. 5 of the decision. of facially neutral handbook The author’s cursory review of the 8Id. at 56. The Administrative Law policies demand careful review after Memorandum finds the policies Judge concluded the rule was facially public input as suggested in the to be superficial with little or no overbroad and ambiguous and would article below. Mere unsupported explanation or rationale for their reasonably tend to chill employees in fiat by the G.C. is not acceptable. conclusions. Essentially, the G.C. the exercise of their Section 7 rights. A fair and balanced approach has provided guidance as to what which protects the labor rights of 9Id. at 2. The Board stated the handbook rules fall under each of the employers and employees is needed. rule did not explicitly restrict three categories established in the activities protected by Section Boeing Co. case — see article, supra. Endnotes 7 of the Act, it was not adopted Most significantly, the Memorandum 1343 NLRB 646 (2004). in response to NLRA-protected instructs the NLRB Regional 2Section 7 of the NLRA provides in activity, and it had not been applied Offices’ to dismiss charges which part that “employees shall have the to restrict such activity. Id. at 1. allege that handbook rules (which are right to self-organization, to form, reviewed in the Memo) falling under 10Id. at 3, 14. join or assist labor organizations… Category 1 are facially unlawful. and shall also have the right to 11Id. at 3-4, 15. The memo specifically reviews refrain from any or all of such nine different types of policies from 12Id. at 17. activities….” 29 U.S.C. Section 157 civility rules, no-photography/ (1988). Section 8(a)(1) of the Act 13Id. at 2. recording rules to disruptive behavior makes it unlawful for an employer to and rules banning disloyalty. 14Id. at 5. interfere, restrain or coerce employees In almost every instance the General in the exercise of Section 7 rights. 15Id. at 5. Counsel’s conclusion follows (29 U.SC. Section 158 (1988)). 16Id. at 6, 17-19. a principle that the identified 3Lutheran, 343 NLRB handbook rules in the designated 17Id. at 19. 646-647 (2004). category “are generally lawful because 18Id. at 17. the rule, when reasonably interpreted 4Memorandum GC 15- does not prohibit or interfere with 04 (March 18, 2015). 19Id. at 23. the rights guaranteed by the Act.” 5365 NLRB No. 154 (Dec. 14, 2017). 20Id. at 26. (Memorandum, p. 2) (Emphasis added). In supporting each rule the 6At the time that The Boeing 21Id. at 31. G.C. repeatedly applies a rationale Company issued, the composition 22Id. at 32. based on an argument along the lines of the Board had shifted from a that even if employees considered a democratic majority to republican. 23Id. at 33. particular rule of this type to apply Chairman Philip Miscimarra, 24Id. at 37. to protected conduct, any impact Members Marvin Kaplan and would only affect peripheral rights. William Emanuel comprised the 25Id. at 14. The Board majority The G.C. offers no supporting republican majority while Members in Boeing agreed that the parties evidence or logical argument to Mark Pearce and Lauren McFerran deserve certainty and clarity. support its conclusions in any of were the democrats. The final the general policies reviewed. decision split 3-2 along party lines.

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Recent Developments in the Duty to Bargain: What Unionized Employers Should Know By William J. Kishman, Squire Patton Boggs (US) LLP

The National Labor Relations Board in several respects. E.I. du Pont de employers.2 Most significantly, has been making headlines lately Nemours (“DuPont”).1 The Board the Board held that an employer — at least among labor lawyers. held in DuPont that, even if an may act unilaterally even if the Since late last year, when the employer had an established past CBA language at issue ceases to be Trump Administration filled two practice of taking a particular action effective. In other words, if a CBA vacant Board seats and the General unilaterally, the employer could expires or changes, that does not Counsel position, the Board has not rely on that past practice after automatically “reset” the parties’ created new precedent in several the applicable collective bargaining past practice or prevent an employer areas. Most of the attention has agreement language expired. In from relying on it. The Board also gone to cases in non-union settings, other words, if the underlying CBA articulated the overarching past however, and key developments for expired, that “negated” any past practice standard in a balanced unionized employers have been lost practice, at least until the parties and workable way; it held that past among flashy decisions regarding renewed the underlying CBA. practice permits unilateral actions joint employment, employee as long as they “do not materially The Board also held that past handbooks, and bargaining unit vary in kind or degree from what has practice alone could not create a determinations. For employers been customary in the past.” Stated defense if the employer had discretion with unions, there have been differently, the past practice does regarding that past practice. In three key takeaways concerning not necessarily need to address an other words, the employer’s actions one of their most significant identical situation to the present one. at issue needed to be “automatic,” obligations: the duty to bargain. “mandatory,” or following a This decision provides significant 1. Employers Have More “fixed formula” in order for the relief for employers who find Flexibility and Certainty employer to continue those actions themselves in extended negotiations When Citing Past Practice unilaterally. This standard created but, at the same time, potentially significant problems for employers, need to change some working Prior iterations of the Board had especially those whose CBAs conditions (such as updating an made it significantly more difficult ended before they were renewed, insurance plan or implementing for employers to invoke past practice and those with large workforces. an annual pay adjustment). It also as a defense to bargaining. Much provides important flexibility for of this difficulty arose from a In Raytheon Network Centric Systems, employers with large workforces, 2016 decision, where the Board the Board overruled DuPont and who naturally need to change changed the applicable standard provided important certainty to 21 Labor and Employment News

working conditions from time- the union’s request, the employer The Board already has removed some to-time in ways materially offered to discuss the matter with of these new deferral requirements, consistent with past practice. the union and “consider[] alternative and likely will remove others soon. 2. The Duty to Furnish requests [the union] may have,” but Last December, the new General Information Still Imposes the employer did not specifically Counsel rescinded one of his a High Standard. propose any accommodation. predecessor’s memos, and granted Board officials more discretion to The Board held that the employer Another case shows that the Board defer even where parties could not violated its statutory duty, and will not significantly change some quickly arbitrate the underlying ordered the employer to produce the standards, including the duty to dispute. The General Counsel also full APA. It relied largely on the fact furnish information. As most indicated that he might challenge that the employer had not specifically unionized employers know, as part of Babcock, as he wrote that he may offered some type of accommodation, their duty to bargain, they generally challenge that type of recent case such as producing a redacted version must furnish unions with requested that departed from prior law. of the APA, or producing it under a information that concerns employees’ At the same time, several media confidentiality agreement with the terms of employment. The Board outlets (including Bloomberg union. The Board did not consider it has, however, recognized several and the New York Times) have sufficient that the employer offered exceptions to this doctrine. These reported that the General Counsel to meet with the union or consider exceptions can arise, for example, is debating whether to restructure any requests the union itself raised. when a union requests information the Board’s regional offices and Rather, according to the Board, that that is confidential, unduly case handling procedures, in a way obligation fell upon the employer. burdensome to produce, or when that resolves unfair labor practice producing that information would In short, the Board closely followed charges more efficiently. These violate a legal obligation (such as established precedent. Thus, changes almost certainly would producing HIPAA-protected medical while the Board likely will modify increase the frequency of deferral. records without an appropriate employers’ bargaining obligations For now, employers with labor release). For an employer to invoke in several respects, and while many unions should watch for further these exceptions, however, the expect the Board to expand the developments. It appears very Board historically has required the “witness statement” exception, the likely that the Board will expand employer to notify the union, explain Board will not take every opportunity this important tool for resolving why the exception applies, and offer that arises to change existing law. unfair labor practice charges. some type of accommodation. 3. The Board Will Defer William Kishman is Of Counsel One recent case shows that the More Cases to Arbitration. at the Cleveland Office of Squire Board will continue applying this Finally, the Board has given strong Patton Boggs (US) LLP, where standard, even when that puts an signs that it will start deferring more he represents employers in matters employer in a very difficult position. cases to arbitration. In recent years, involving employees and labor unions. In Crozer Chester Medical Center, the Board had required employers a union requested a particularly Endnotes to satisfy additional requirements confidential document: a full asset 1364 NLRB No. 113 (2016). to have a case “deferred,” i.e., purchase agreement (APA), in a to allow an employer and union 2365 NLRB No. 161 (2017). situation where the employer was resolve an unfair labor practice issue selling its business, but the sale 3366 NLRB No. 28 (2018). through their grievance-arbitration had not yet occurred.3 Moreover, procedure. Many of these new 4361 NLRB No. 132 (2014). the employer had entered into a requirements arose from a recent confidentiality agreement with the Board decision, Babcock & Wilcox prospective buyer, which barred Construction.4 Others arose from the employer from disclosing the memos that the prior Board General APA. After the employer received Counsel issued to Board officials. 22 Labor and Employment News

Opioid Abuse in the Workplace By Bob Robenalt, Fisher Phillips

Our nation’s opioid crisis has been This has left employers grappling approach to drug abuse at work: described as the deadliest drug with issues of lost productivity, (1) a written drug-free workplace epidemic in U.S. history. The higher absenteeism, greater risk of policy; (2) a supervisor training number of overdose deaths from workplace injuries, an increase in program; (3) an employee education opioids has quadrupled since 1999, positive drug tests, workplace theft and awareness program; (4) an according to the CDC. In fact, and higher healthcare costs. Many employee assistance program (EAP); six out of 10 overdose deaths are businesses are even experiencing and (5) a drug testing policy. the result of opioid abuse. And for labor shortages due to more Although employers are not able to every person who dies from a drug difficulty in hiring and retaining a diagnose or treat opioid-dependent overdose, another 130 individuals sufficient number of workers who workers, they can help those are living with an addiction. can successfully pass a drug test, employees by providing educational leading some employers to scrap their In a grim reality, Ohio leads the resources and better access to drug testing policies altogether. opioid epidemic, with more overdose treatment. With the growing opioid deaths than any other state. As In response, employers are being crisis, many employers are actually many Ohio businesses — both urged to become an integral part shifting away from zero-tolerance large and small — have discovered, of a massive effort to help educate, drug policies and instead turning to the opioid crisis is having a support and rehabilitate opioid- more proactive measures, including: significant impact on the workforce, dependent workers. But how? • The revival of “last-chance especially given that opioids are How Employers Can agreements” that offer drug- commonly prescribed to treat Take a Proactive Role dependent employees a work-related injuries or conditions second chance to get clean protected under the Americans Generally speaking, employers — as opposed to immediate with Disabilities Act (ADA). should develop a five-pronged termination — after the 23 Labor and Employment News

first positive drug test. This provides employees with an opportunity to obtain treatment and get back into the workforce. However, it’s important to note employers still reserve the legal right to enforce disciplinary actions and/or termination for drug-related workplace misconduct, such as on-the- job impairment, tardiness, absenteeism, workplace accidents and theft. • Expanding supervisor training programs to employers are prohibited from asking and higher tolerance levels in include proper methods for about an employee’s disability, illness the event of a future surgery. detecting the signs of drug or addiction. In most cases, employers use, how to conduct fitness- Recently, the Ohio Bureau of only learn of an employee’s addiction for-duty evaluations and Workers’ Compensation put limits indirectly from co-workers or suspect reasonable suspicious drug on the use of opioids to treat work- it due to workplace misconduct. testing, and procedures for related injuries and began covering assisting employees when In the rare event that an employee treatment for opioid-dependent reaching out to EAPs or voluntarily shares their addiction, an workers. Employers can also work other treatment programs for employer will need to determine if with their workers’ compensation help with their addiction. the worker has a “qualified disability,” insurers to closely monitor the use meaning he or she no longer engages and abuse of opioids by injured • Offering employee education in illegal drug use and is enrolled in workers, and provide access to programs and EAPs that a treatment program. In this case, an alternative treatment options. provide information on the employer is obligated under the ADA harmful effects of opioid Although there’s no “perfect” to provide reasonable accommodation abuse, recognizing signs of solution, employers can address for the worker — such as an drug abuse, proper handling and combat the opioid crisis by unpaid leave of absence or schedule and storage of medicine at taking these proactive steps to help adjustments to attend treatment — home, and how to access get opioid-dependent employees unless it would be an undue burden. treatment for a worker or back into the workforce. loved one. In addition, On the Workers’ A version of this article originally employers may want to Compensation Front appeared in Legal Connections, a consider appointing a Most insurers seek to minimize Columbus Bar Association publication. compliance officer to oversee the impact of claims by finding these programs and address the least expensive treatment for any confidentiality issues work-related injuries — usually associated with drug testing. prescription painkillers — even Interplay with the ADA when medical providers recommend a more aggressive option. However, Employers must also understand this dynamic can lead to an the interplay between illegal drug increased risk of opioid dependency use and the ADA. Under the ADA,

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Note from the Chairman

The Labor and Employment (L&E) Section is always interested in enhancing its membership. Kristen McKinley (Ohio Association of Public School Employees) is chairing our efforts in this regard. We are #MeToo/#TimesUp: working to identify members of Sexual Harassment’s New Environment various L&E focused groups who may be prospective members, and By Julie Davis, James E. Arnold & Associates, LPA and welcome any ideas from existing Bruce Elfvin, Elfvin, Klingshirn, Royer & Torch, LLC members to expand our numbers. Our goal is to grow membership On Jan. 30, 2018, the OSBA’s Labor three panel discussions with issues by 10 percent this year. Section & Employment Section produced a ranging from: employer responses, members receive a $50 discount on three-hour seminar on legal issues changing demands regarding the Midwest Labor and Employment involving the #MeToo/#TimesUp confidentiality, and appropriate Law Seminar, so as a financial movement. In the past year, actions from investigation to proposition alone, it is an easy sell. Of attention on sexual harassment has decisions and reporting. The final course, we believe members receive virtually exploded, with rolling panel analyzed how to improve even greater value as the Section exposés of conduct about media prevention and training regarding continues to heighten its visibility moguls, political representatives, sexual harassment and the keys to and activity level. Please mention and executives. Much of the effective harassment prevention. membership to your contacts, alleged conduct took place in the and share your ideas with Kristen The OSBA’s Labor & Employment employment context, and if there ([email protected]) and Section is committed to not only is one takeaway, it is that now and Bill Nolan ([email protected]). following all the new developments going forward reports of sexual on this subject, but making timely harassment or sexual misconduct information and analysis available to will be given more credibility, more all section members in representing attention and more response. their clients. There will be a follow- Note from the The conference addressed many up panel at the Midwest Labor Section Council of the compelling issues presented and Employment Law Seminar by the #MeToo movement from in October that will synthesize the perspectives of the accuser, the the developments of #MeToo and The Section Council is pleased to individual accused, and the employer. #TimesUp throughout this year. announce that Zachary T. Cuny The panelists provided the audience of the University of Cincinnati with valuable insight and information School of Law was selected as a about what these parties should do 2018 recipient of Law Student when tackling a #MeToo-era sexual Achievement Award from the assault or harassment claim. The OSBA’s Labor and Employment Law discussion included consideration of Section. Congratulations, Zachary! factors such as when allegations are more historic and/or very public on social media. The seminar included

25 Labor and Employment News

Labor & Employment Section Council Executive Committee Roger King, Chair ([email protected]) John Marshall, Vice President ([email protected]) Sara Jodka, Secretary & Treasurer ([email protected]) Bill Nolan, Member ([email protected]) Mike Hunter, Member ([email protected]) Stacy Pollock, Member ([email protected]) Bruce Elfvin, Member ([email protected])

Labor & Employment Section Council Committees

Advanced Employment Law CLE NLRB/NLRA CLE • John Marshall, Co-Chair • Mike Hunter, Co-Chair ([email protected]) ([email protected]) • Charlie Warner, Co-Chair • Bill Nolan, Co-Chair ([email protected]) ([email protected])

Basics of Labor & Employment Law CLE Ohio Legal Forum • Sara Jodka, Chair • Stacy Hinners, Chair ([email protected]) ([email protected])

Communications Committee Professionalism Initiative • Joe D’Andrea, Co-Chair • Karen Adinolfi, Chair ([email protected]) ([email protected]) • Robert Fekete, Co-Chair ([email protected]) Public Sector CLE • Alan Zmija, Co-Chair ([email protected]) • Stacy Pollock, Co-Chair ([email protected]) Judicial/Agency/Legislative Developments Committee • Don Collins, Co-Chair • Marjorie Conner, Co-Chair ([email protected]) ([email protected]) • Stephanie Schoolcraft, Co-Chair Webcasts ([email protected]) • Marilyn Widman, Co-Chair ([email protected]) Midwest Labor & Employment Law Conference • Liz Crosby, Co-Chair ([email protected]) • Roger King, Chair ([email protected]) Save the Date for CLE! New Membership Committee • Kristen McKinley, Chair 55th Annual Midwest Labor and ([email protected]) Employment Law Seminar • Maryellen Reash, Co-Chair October 11 & 12 (Hilton Columbus at Easton) ([email protected]) National Labor Relations Board Update December 4 (Columbus – simulcast to Cleveland, Fairfield, Perrysburg and Webcast)

26 Labor and Employment News

Labor and Employment Section Council News

The Labor and Employment Section would like to welcome Mike Frantz and Susannah Muskovitz, who have been appointed to serve a three-year term on its Section Council. Both Mike and Susannah will be serving on the Council’s New Member Committee. Additionally, the Section is very happy to have Kristen McKinley, Stephanie Schoolcraft, and Patty Wise, returning for another three-year term on the Council.

About Labor and Employment News

Labor and Employment News is produced by the Ohio State Bar Association Labor and Employment Section. The OSBA publishes 10 committee and section newsletters.

For more information about Labor and Employment News, contact editors Robert Fekete, Office of the Ohio Attorney General (Columbus), at [email protected], Joseph D'Andrea, Squire Patton Boggs (Columbus), at [email protected] and Alan Zmija (Cleveland) at [email protected].

Articles published in this newsletter reflect the views and opinions of the writers and are not necessarily the views or opinions of the OSBA Labor and Employment Section. Publication in Labor and Employment News should not be construed as an endorsement by the section or the OSBA.

Any author interested in submitting an article for publication is encouraged to contact the editors.

For information about other OSBA committee and section newsletters, contact Dan Beckley, OSBA Website and Digital Content Strategist, at P.O. Box 16562, 1700 Lake Shore Drive, Columbus, Ohio 43216-6562, (800) 282-6556 or (614) 487-4472, or email at [email protected].

Editors’ Note—Guest Columns

Anyone interested in submitting Fekete@OhioAttorneyGeneral. range between 1 to 10 pages but an article for publication in gov, joseph.dandrea@squirepb. works outside of those limitations the Labor and Employment com and [email protected]. will be considered. The editors Law Section newsletter are Articles should not have appeared reserve the right to select articles encouraged to contact the in other publications, but works for publication, to decline to newsletter editors, Robert Fekete appearing only on your employer’s publish any article and to require (Columbus), Joseph D’Andrea website or client newsletter will the editing of an article to make (Columbus) and Alan Zmija be considered with the employer’s it appropriate for publication. (Cleveland) by email at Robert. approval. Articles will typically

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