Original Article American Staffing Association (11/07/12) Ed Lenz
President Obama's decisive victory in the 2012 presidential election means that few, if any, major policy shifts are likely to occur in the next four years. A key question is whether the federal government can produce any significant accomplishments during that time. This will largely depend on whether the president can forge a consensus with Republicans in Congress following one of the most contentious political campaigns in recent memory.
An immediate test for all parties will be to address the daunting economic and political challenges presented by the "fiscal cliff," which calls for automatic steep tax increases and across-the-board spending cuts beginning Jan. 1, 2013, unless a compromise is reached. If the issues can't be resolved in the upcoming lame duck session of Congress, they surely will dominate the legislative agenda in the early months of the president's second term.
Although Republicans had expected to gain seats in the Senate, perhaps even regain the majority, they may actually lose ground. Republicans picked up a seat in Nebraska but lost seats previously held in Indiana, Maine, and Massachusetts which would mean a net loss of two seats unless Democrats lose in Montana and North Dakota. The Democratic candidates were leading in those states as of Tuesday night, but the races were still too close to call. If they hold those seats, Democrats will control the Senate by a margin of 55 to 45, including independents Bernie Sanders of Vermont who always votes with the Democrats and newly elected Angus King of Maine who is expected to do so. However, Republicans maintained their majority in the House, which means that congressional gridlock looms, on the fiscal cliff and other issues, unless lawmakers can find a way to bridge their differences. Given the dire economic consequences of failure, compromise is likely—but the precise contours of an agreement are impossible to predict.
One thing is clear: Implementation of the Affordable Care Act will move forward. For employers, this means that, effective Jan. 1, 2014, they will have to either offer qualified health insurance to their full-time employees or pay penalties if even one employee receives government assistance to buy health coverage through a state health exchange. Fortunately, ASA and its coalition allies were successful in persuading the Obama administration to allow employers with "variable hour" employees to use a "look-back" period of up to 12 months to determine whether those employees have worked full-time for purposes of offering health coverage or paying penalties. The look-back is expected to substantially reduce staffing firms' exposure to penalties for their temporary employees.
Although the nation's attention has been riveted by the presidential and congressional races, key elections held across the country at the state level could significantly affect businesses. Most of the adverse legislation aimed at staffing firms, historically, has come from the states. ASA will examine the implications of those elections and will report on the regulatory challenges they could present for the staffing industry in 2013 and beyond.
Wednesday, November 21, 2012
Friday, November 9, 2012
Virginia Supreme Court ruling extends wrongful discharge liability to individuals
Williams Mullen Heath H. Galloway and Reba Mendoza USA
Original Article
November 6 2012
On November 1, 2012, the Virginia Supreme Court, addressing a question of law certified by the United States Court of Appeals for the Fourth Circuit, held that individuals such as supervisors and managers who participate in the firing of an employee can be subject to tort liability for wrongful discharge. In doing so, the court effectively extended liability for wrongful discharge to non-employers. The court ruled that allowing such personal liability was consistent with the principles of tort liability and that the decision was in furtherance of public policy.
The underlying suit, VanBuren v. Grubb, 471 Fed. Appx. 228 (4th Cir. 2012), was filed by Angela VanBuren against Virginia Highlands Orthopedic Spine Center, LLC (“Virginia Highlands”) and Dr. Stephen Grubb. VanBuren was employed as a nurse by Virginia Highlands from December 2003 to March 2008. VanBuren alleged that, throughout her employment with Virginia Highlands, she was subjected to “offensive” and “unwelcome” sexual harassment by her supervisor and Virginia Highlands’ owner, Dr. Grubb. VanBuren also alleged that when she refused to leave her husband and engage in an adulterous relationship with Dr. Grubb, she was terminated. VanBuren sued, claiming that Virginia Highlands engaged in gender discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C.§§2000e-2(a) and 2000e-3(a). VanBuren also brought wrongful discharge claims against both Virginia Highlands and Dr. Grubb under Virginia law. Virginia recognizes a narrow public policy exception to its stringent employment at-will doctrine and allows an individual to bring a wrongful termination claim if he or she was fired for, among other things, refusing to engage in an act made criminal under Virginia law. VanBuren claimed that she was terminated because she refused to engage in the criminal acts of adultery and open and gross lewdness and lasciviousness.
The United States District Court for the Western District of Virginia dismissed the wrongful discharge claim against Dr. Grubb, stating that such claims cannot be sustained against supervisors and co-workers, but are limited to the actual employer. On appeal, the Fourth Circuit determined that the Supreme Court of Virginia had not squarely addressed the issue of whether a non-employer may be held liable for wrongful discharge under Virginia law. Thus, the federal court certified the question to the Supreme Court of Virginia.
In a 4-3 opinion, the Supreme Court of Virginia held that an employee can maintain a wrongful discharge claim against a non-employer, such as a supervisor or manager, when such individual acts in violation of certain Virginia public policies and participates in the termination of the employee. In the majority opinion, Justice Millette emphasized that wrongful discharge is a tort claim and not a contract claim. In tort actions, the majority reasoned, individuals are responsible for their own torts, even when individuals are agents acting on behalf of their employers. The court defined the tortious act in a wrongful termination claim as stemming from the wrongful reasons behind the termination and not the mere act of termination itself. Thus, when the tortious reasons behind the discharge arise from the unlawful actions of the individual effecting the discharge, such individual should share in the liability. Moreover, the majority noted that its holding was in furtherance of public policy because the purpose behind the wrongful discharge exception to the employment at-will doctrine is to prevent individuals from discharging employees in violation of public policy. The majority concluded that this intention is best effectuated when employees have a cause of action against the individual in the position of power in addition to the employer. The majority held that limiting liability to the employer is not sufficient to deter wrongful discharge. Notably, the majority acknowledged that its decision to recognize this cause of action could have a chilling effect on supervisors who seek to discharge at-will employees for legitimate reasons. However, the majority argued that the limited nature of the cause of action provides sufficient protection against the abuse of this cause of action. Specifically, the tort of wrongful discharge continues to be a narrow exception to the employment at-will doctrine, and individual liability under a wrongful discharge claim is limited to situations where the individual’s personal actions violate the public policy.
This ruling will likely spur an increase in wrongful discharge claims against individual defendants. At the very least, employers should expect to see individual supervisors named in most employment discrimination cases. In addition, and notwithstanding Justice Millette’s assurances, this ruling will undoubtedly cause supervisors considerable angst when considering a legitimate termination decision. Thus, this is an excellent opportunity to review employment policies with pertinent managers and supervisors to ensure compliance with such policies, and thereby reduce both employer and individual liability under wrongful termination claims. It may also be prudent for employers to provide supervisors and managers with additional training and/or limit the ability of these individuals to make discharge decisions
Thursday, November 1, 2012
WHO IS YOUR EMPLOYER FOR WORKERS’ COMPENSATION BENEFITS
In the current labor market, many employees are placed in employment through temporary agencies. There are many agencies in the local market including Labor Ready, Inc., and Manpower. If an employee is injured on the job that they have been placed into by a temporary agency, a question arises as to who is their employer. A recent Pennsylvania Superior Court decision was issued explaining this relationship.
In Black v. Labor Ready, Inc., et al., the Pennsylvania Superior Court made a determination that a temporary agency was the employer of an injured worker who had been placed to work at Williamsport Steel Container, Inc., where she was injured. The Plaintiff was injured when she was working on a punch press machine in the factory of Williamsport Steel Container, Inc., when the machine descended on the Plaintiff’s hand, amputating it. The Plaintiff filed a workers’ compensation claim against both Labor Ready, Inc., the temporary agency, and also Williamsport Steel Container, Inc.. The matter was assigned to a workers’ compensation judge for disposition. The Defendant, Williamsport Steel Container, Inc., filed an answer to the Plaintiff’s petition alleging that it was not her employer and, rather, that Labor Ready, Inc., was the Plaintiff’s employer. The workers’ compensation judge decided that the temporary agency was, in fact, the Plaintiff’s employer. Subsequently, the Plaintiff filed a civil law suit against Williamsport Steel Container, Inc., alleging that she was injured due to their negligence in the maintenance of the punch press machine. In response to that complaint, Williamsport Steel Container, Inc., changed its position and filed a Motion for Summary Judgment attempting to dismiss the Plaintiff’s claim. In the Motion, Williamsport Steel argued that it was the Plaintiff’s employer and as such she was barred from pursuing any civil law suit against it, because her exclusive remedy was the Workers’ Compensation Act.
The workers’ compensation law and the law of the Commonwealth of Pennsylvania clearly states that:
Where an employee’s injury is compensable under the Workers’ Compensation Act, the compensation provided by the statute is the employee’s exclusive remedy against his or her employer. Thus, an injured employee cannot maintain a tort action against his or her employer if the injury is compensable under the provisions of the Act.
Albright v. Fagan, 671 A.2d 760 762 (Pa. Super. 1996).
The Pennsylvania Superior Court then looked into the apparent inconsistent positions that Williamsport Steel had taken in this particular situation. The Pennsylvania Supreme Court has specifically held that as a general rule, a party to an action is estopped from assuming a position inconsistent with his or her assertion in a previous action, if his or her contention was successfully maintained. In re, adoption of S.A.J., 575 Pa. 624, 631, 838 A.2d 616, 620 (2003).
In Black, the Superior Court specifically held that an employer, in this matter Williamsport Steel Container, Inc., could not maintain an inconsistent position. Thus, its previous answer in the workers’ compensation claim, specifically denying the Plaintiff was an employee, barred Williamsport Steel from raising the contention that she was their employee in the civil lawsuit. As such, the Plaintiff was permitted to pursue a civil action against the business where she was placed by the temporary agency. This decision is important, as it potentially expands the rights of injured parties to seek redress for their injuries, and more clearly define the employer-employee relationship in situations involving temporary agencies.
Original site: http://www.law-aca.com
TAKE AWAY: Three things, as an employer, to keep in mind when working with a staffing agency:
1) Make sure that the contract you are signing with the staffing agency specifically addresses who is responsible for workers' compensation. Ideally, you should expect and demand wording to the effect that "staffing agency is responsible for managing and paying workers' compensation claims arising from the client work place."
2) Make sure the staffing agency has--in either its policies and procedures or its employee handbook--a statement regarding the co-employment nature of the placement and that workers' compensation is the sole responsibility of the staffing agency. The staffing agency should want to comply with both points one and two as it should protect them from civil lawsuits as described in Black. Points one and two also provide some protection in front of a workers' comp judge, as in the case of the first suit referenced in Black.
3) If you do find yourself faced with the circumstances described in the workers' comp case, consult your attorney (I am not an attorney and should not be considered a substitute). Avoid a defense in which you claim to not be the employer. Instead, defend yourself that you are a "co-employer" but that the staffing agency is ultimately responsible for workers' comp claims (and then present your handy-dandy contract referenced above). The co-employment status should present significant protection against the subsequent civil lawsuit.
In Black v. Labor Ready, Inc., et al., the Pennsylvania Superior Court made a determination that a temporary agency was the employer of an injured worker who had been placed to work at Williamsport Steel Container, Inc., where she was injured. The Plaintiff was injured when she was working on a punch press machine in the factory of Williamsport Steel Container, Inc., when the machine descended on the Plaintiff’s hand, amputating it. The Plaintiff filed a workers’ compensation claim against both Labor Ready, Inc., the temporary agency, and also Williamsport Steel Container, Inc.. The matter was assigned to a workers’ compensation judge for disposition. The Defendant, Williamsport Steel Container, Inc., filed an answer to the Plaintiff’s petition alleging that it was not her employer and, rather, that Labor Ready, Inc., was the Plaintiff’s employer. The workers’ compensation judge decided that the temporary agency was, in fact, the Plaintiff’s employer. Subsequently, the Plaintiff filed a civil law suit against Williamsport Steel Container, Inc., alleging that she was injured due to their negligence in the maintenance of the punch press machine. In response to that complaint, Williamsport Steel Container, Inc., changed its position and filed a Motion for Summary Judgment attempting to dismiss the Plaintiff’s claim. In the Motion, Williamsport Steel argued that it was the Plaintiff’s employer and as such she was barred from pursuing any civil law suit against it, because her exclusive remedy was the Workers’ Compensation Act.
The workers’ compensation law and the law of the Commonwealth of Pennsylvania clearly states that:
Where an employee’s injury is compensable under the Workers’ Compensation Act, the compensation provided by the statute is the employee’s exclusive remedy against his or her employer. Thus, an injured employee cannot maintain a tort action against his or her employer if the injury is compensable under the provisions of the Act.
Albright v. Fagan, 671 A.2d 760 762 (Pa. Super. 1996).
The Pennsylvania Superior Court then looked into the apparent inconsistent positions that Williamsport Steel had taken in this particular situation. The Pennsylvania Supreme Court has specifically held that as a general rule, a party to an action is estopped from assuming a position inconsistent with his or her assertion in a previous action, if his or her contention was successfully maintained. In re, adoption of S.A.J., 575 Pa. 624, 631, 838 A.2d 616, 620 (2003).
In Black, the Superior Court specifically held that an employer, in this matter Williamsport Steel Container, Inc., could not maintain an inconsistent position. Thus, its previous answer in the workers’ compensation claim, specifically denying the Plaintiff was an employee, barred Williamsport Steel from raising the contention that she was their employee in the civil lawsuit. As such, the Plaintiff was permitted to pursue a civil action against the business where she was placed by the temporary agency. This decision is important, as it potentially expands the rights of injured parties to seek redress for their injuries, and more clearly define the employer-employee relationship in situations involving temporary agencies.
Original site: http://www.law-aca.com
TAKE AWAY: Three things, as an employer, to keep in mind when working with a staffing agency:
1) Make sure that the contract you are signing with the staffing agency specifically addresses who is responsible for workers' compensation. Ideally, you should expect and demand wording to the effect that "staffing agency is responsible for managing and paying workers' compensation claims arising from the client work place."
2) Make sure the staffing agency has--in either its policies and procedures or its employee handbook--a statement regarding the co-employment nature of the placement and that workers' compensation is the sole responsibility of the staffing agency. The staffing agency should want to comply with both points one and two as it should protect them from civil lawsuits as described in Black. Points one and two also provide some protection in front of a workers' comp judge, as in the case of the first suit referenced in Black.
3) If you do find yourself faced with the circumstances described in the workers' comp case, consult your attorney (I am not an attorney and should not be considered a substitute). Avoid a defense in which you claim to not be the employer. Instead, defend yourself that you are a "co-employer" but that the staffing agency is ultimately responsible for workers' comp claims (and then present your handy-dandy contract referenced above). The co-employment status should present significant protection against the subsequent civil lawsuit.
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