CONNECTICUT 2012 LAW DEVELOPMENTS

1. HRACC 2012 WORKPLACE LAW UPDATESEPTEMBER 19, 2012 Beverly W. Garofalo, Esq. garofalb@jacksonlewis.com James F. Shea, Esq. sheaj@jacksonlewis.com Jackson|Lewis LLP CONNECTICUT 2012 LAW DEVELOPMENTS

2. Jackson Lewis LLP is dedicated to representing management exclusively in workplace law and related litigation. With over 700 attorneys practicing in 49 locations nationwide, the firm has a national perspective and sensitivity to the nuances of regional business environments. Guided by the principle that a positive work environment results in enhanced morale and increased productivity, the firm devotes a significant portion of its practice to management education and preventive programs. This approach helps limit exposure to grievances, charges and lawsuits. www.jacksonlewis.com

4. EEOC Charges: National 99,947 total charges filed directly with the EEOC nationally in FY 2011(down from 99,922 in FY 2010) In FY 2011, EEOC collected $455 million from private employers

5. EEOC Charges: CT 262 total charges filed with the EEOC out of CT in FY 2011(down from a high of 295 in FY 2010)

6. 2012 UPDATE Federal Law & Decisions of Note

7. U.S. Supreme Court Christopherv. Glaxo SmithKline Beecham, 132 S.Ct 2156 (June 18, 2012) – Pharmaceutical sales reps exempt from overtime pay Facts: • FLSA exempts “outside salesmen” from overtime pay requirement. • The plaintiffs, two pharmaceutical sales representatives (PSR), argued they do not fit that definition so entitled to overtime pay. Specifically, claimed they do not make actual “sales” but could only encourage doctors to prescribe their companies’ products. • Circuit courts split on the issue. Numerous collective actions pending against pharmaceuticals.

8. U.S. Supreme Court Holding: • U.S. Supreme Court held that PSR’s are exempt “outside salesmen” under FLSA because they provide information to physicians in an attempt to persuade them to prescribe their products. • PSR’s obtaining of a “nonbinding commitment from a physician to prescribe one of respondent’s drugs” along with the indicia of salesmen was enough to qualify as an “outside salesmen.” • Indicia included that they were: • hired for sales experience • worked away from office • minimal supervision • rewarded with incentive compensation based upon sales data

9. Upcoming Supreme Court Cases • Supervisor Liability – Vance v. Ball State University: Whether under the Title VII “supervisor liability” rule, an employer is vicariously liable for severe or pervasive workplace harassment by those whom the employer vests with authority to direct and oversee the victim’s daily work, or whether only vicariously liable for harassers with power to “hire, fire, demote, promote, transfer, or discipline” their victim. • Employee Benefit Plans – U.S. Airways v. McCutchen: Whether ERISA Section 502(a) (3) authorizes courts to use equitable powers to rewrite contractual language in employee benefits plans and refuse to order plan participants to reimburse their plan for benefits paid by a third party, even where the plan’s terms give it an absolute right to full reimbursement.

10. Proxy Liability in Sex Harassment Cases Townsend v. Benjamin Enterprises, 2012 U.S. App. LEXIS 9441 (2d Cir. May 9, 2012) – adopting the theory of “proxy liability” in sexual harassment cases Facts: • The plaintiff claimed she was harassed by her supervisor, who was also vice president of the company and had decision-making authority over corporate matters. The HR Director claimed she was terminated in retaliation for conducting an investigation into the plaintiff’s complaint. • The Court granted summary judgment on the HR Director’s claim. Plaintiff Townsend’s claims went to trial and the jury found in her favor.

11. Proxy Liability in Sex Harassment Cases Holding: • On appeal, the defendant employer claimed it was entitled to a “Faragher/Ellerth” affirmative defense and avoid liability since it took effective remedial measures after the employee complained about the harassment • The Second Circuit affirmed the jury verdict, and in so doing recognized another exception to the affirmative defense: proxy, or alter ego, liability. • In an issue of first impression, the Second Circuit decided that if a supervisor was of “sufficiently high rank” in the company, such as a “president, owner, proprietor, partner, or corporate officer”, s/he qualified as a proxy for the company and the company is not entitled to affirmatively defend a sexual harassment claim by demonstrating that it took reasonable steps to correct upon notice of the issue. • The Second Circuit also affirmed the summary judgment decision, holding that the investigation must be one by the EEOC to qualify under Title VII.

12. Sexual Harassment and Retaliation:Lesson EEOC v. Fry's Electronics, Inc., (2:10-CV-1562) (9th Cir. Apr. 11, 2012) – Settlement of sexual harassment and retaliation claim to former employees Facts: • Female employee was harassed by asst. store manager, including the sending of sexually charged texts and inviting her for drinks to his home • Employee reported to her supervisor, who then took her complaint to corporate offices. • Corporate office referred supervisor back down to store manager --- who was friends with the accused harasser. • Manager never interviewed victim and, instead of disciplining accused harasser, actually accused the immediate supervisor who reported the harassment of sexually harassing the employee. Manager then fired supervisor, and the female employee was terminated shortly thereafter.

13. Sexual Harassment and Retaliation:Lesson EEOC filed suit, alleging sexual harassment and retaliatory conduct. Fry’s agreed to settle case, and pay out $2.3 million to former employees - among the highest amounts ever on a per-claimant basis. • Federal judge also ordered Fry’s to: • offer ongoing sexual harassment training to all employees and management • Post a notice for all its employees regarding the settlement, • Pay $100,000 for withholding information in the investigation of the case and destroying relevant evidence. EEOC statement noted that “Fry’s did just about everything wrong that they possibly could have done.”

14. Leaves of Absences as an Accommodation under the ADA Robert v. Board of County Comm’rs of Brown County, KS (11-3092) (10th Cir. August 29, 2012) – How much leave, beyond FMLA and employer policies, must employer give a disabled employee as reasonable accommodation under ADA? Court held there were two (2) limits to bounds of reasonable leave of absence: • Definite Estimate by Employee: Employee must provide employer with estimated date when s/he can resume essential duties. • Durational: Leave request must assure an employer that employee can perform essential functions in “near future.” Plaintiff here failed to provide definite estimate, so any exemption beyond six months of accommodation was unreasonable. Court cited Eighth Circuit case which held a six-month leave request was too long to be a reasonable accommodation.

15. Leaves of Absences as an Accommodation under the ADA Samper v. Providence St. Vincent Med. Ctr. (10-35811) (9th Cir. Apr. 11, 2012) – Duty to show up for work trumps ADA accommodations claim Facts: • Neonatal intensive care nurse with fibromyalgia exceeded allowed unplanned absences in attendance policy for 8 years, and was terminated on that basis. • Nurse sued employer under ADA, alleging failure to reasonably accommodate. • 9th Circuit upheld granting of summary judgment in employer’s favor, finding that employer had met its burden of showing that regular attendance was an essential job function of a NICU nurse. • Court found that attendance policy was attempt to balance employee’s needs for unplanned absences against its own need to provide patient care. The employer “was under no obligation to give [the nurse] a free pass for every unplanned absence,” especially since employer accommodated for years.

16. Joint Employment Daniel v. Sargent and Lundy (E.D. Ill) (March 2012) – Joint Employment with Customers Facts: • Customer outsourced its janitorial services to vendor. • Customer monitored plaintiff’s daily cleaning performance; could direct Plaintiff to perform additional tasks; monitored complaints about plaintiff by customer employees. • After receiving complaint about plaintiff sleeping in a conference room; customer notified vendor that plaintiff was no longer allowed on its premises and could find no other position. • Plaintiff sued both customer and vendor for race discrimination.

17. Joint Employment Holding: • Although Customer did not pay Plaintiff, based on extent of direction and control, it could be a common-law employer and allowed case against Customer to go to a jury. If joint employment found, Vendor and Customer can be held jointly and severally liable for each other’s actions. Vendors should take steps to avoid joint employment by: • Directing and controlling its own workforce through its on-site managers – establishing wall between Customer managers and Vendor employees. • Managing all HR issues involving its workforce. • Working in cooperation with Customers on personnel issues that may creat liability or impair relationship.

18. EEOC GuidanceCriminal and Arrest Records Federal law does not prohibit use of criminal history in hiring decisions BUT employer must show that exclusion is “job related and consistent with business necessity” for position in question • Guidance discourages use of criminal conduct inquiries on applications, recommending that such inquiries be addressed later in the process. • Develop “Targeted Screen”: Based on nature of crime, time elapsed, and nature of job. • Provide for “Individualized assessment:” In order to determine whether the policy “as applied” to a particular candidate is “job related and consistent with business necessity.”

19. EEOC GuidanceCriminal and Arrest Records Guidance lists possible topics of consideration in an individualized assessment, all of which generally require a dialogue, including: • Facts and circumstances surrounding the offense • Number of offenses for which individual was convicted • Age at time of conviction or release from prison • Evidence that individual performed the same type of work, post-conviction, with the same or a different employer, without incidents of criminal conduct • Length and consistency of employment history before and after the offense • Employment, character references, and other information about fitness for position

20. EEOC GuidanceCriminal and Arrest Records • Guidance Lists Best Practices for Employers Who Use Criminal Background Checks in Hiring Process • Develop a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct. • Policy should identify essential job requirements and the actual circumstances under which jobs are performed • Determine the specific offenses that may demonstrate unfitness for performing such jobs • Train managers and hiring officials on how to implement policy consistent with Title VII Link: http://www.eeoc.gov/laws/guidance/arrest_conviction.cfm

21. EEOC Guidance Reasonable Factors Other than Age • Age Discrimination in Employment Act (“ADEA”) prohibits age discrimination, including employer practices which have the effect of harming older workers more than younger workers (“disparate impact”) even if employer’s policy is neutral on its face. • Defense to ADEA disparate impact claim is now employer’s ability to provide “Reasonable Factors Other than Age” (RFOA) as reason for its policy (employer need not prove plaintiff-friendly “business necessity” reason as previously). • Rule applies to all private employers with 20 or more employees, state and local government employers, employment agencies, and labor organizations. • An employment practice is based on RFOA when it is: “reasonably designed and administered to achieve a legitimate business purpose”

22. EEOC Guidance Reasonable Factors Other than Age List of considerations relevant to assessing reasonableness: • Extent to which the factor is related to the employer’s stated business purpose • The extent to which the employer defined the factor accurately and applied the factor fairly and accurately, including the extent to which managers and supervisors were given guidance or training about how to apply the factor and avoid discrimination; • The extent to which the employer limited supervisors’ discretion to assess employees subjectively, particularly where the criteria that the supervisors were asked to evaluate are known to be subject to negative age-based stereotypes; • The extent to which the employer assessed the adverse impact of its employment practice on older workers; and • The degree of the harm to individuals within the protected age group, in terms of both the extent of injury and the numbers of persons adversely affected, and the extent to which the employer took steps to reduce the harm, in light of the burden of undertaking such steps.

23. EEOC Strategic Enforcement PlanDraft EEOC released new and aggressive SEP draft on September 4, 2012. • Stated Plan Priorities: • Target systemic class-based recruiting and hiring discrimination. • Protection of immigrant and migrant workers from discrimination. • Investigation of emerging issues such as: common ADA defenses invoked by employers, protecting members of LGBT community from employment discrimination, and pushing employers’ to accommodate pregnant women. • Other particular employment practices of interest include “pre-employment tests, background screens, and date of birth screens in online applications”. • Plan also states that EEOC will focus on “channeling/steering of individuals into specific job due to their status in a particular group.” • Link: http://www.eeoc.gov/eeoc/plan/sep_public_draft.cfm

24. NLRBAt-Will Disclaimers • “I further agree that the at-will employment relationship cannot be amended, modified or altered in any way.” • Invalid: NLRB reasoned that it could be seen to prohibit rights of employees to engage in concerted activity. • “I understand my employment is ‘at will’” and “I acknowledge that no oral or written statements or representations regarding my employment can alter my at-will employment status, except for a written statement signed by me” and executives. • Removed by employer after NLRB complaint and settlement

25. NLRBSocial Media Social Media Policies in Employee Handbooks - NLRB focus on whether social media policy language could “reasonably” be read as restricting employees’ rights to engage in protected concerted activity. Examples of unlawful language in NLRB report: • Telling employees that if they are in doubt about whether to post something, “DO NOT POST” but rather check with company’s attorney or legal department. • A policy that suggests that employees not “pick fights” online and to communicate in a “professional tone.” • Advising employees that they are “encouraged to resolve concerns about work by speaking with co-workers, supervisors or managers.” • Telling employees that they can’t publish online “material non-public information” or “confidential or proprietary” information. • Prohibiting employees from making “disparaging or defamatory comments.”

26. NLRBConfidentiality of Investigations Banner Health System d/b/a/ Banner Estrella Med. Ctr., 358 NLRB 93 (July 30, 2012): Hospital’s request that employees interviewed in connection with an internal investigation not discuss the matter with co-workers while the investigation was ongoing held by NLRB to be violation of National Labor Relations Act. • NLRB’s position is that even a “mere suggestion” to employees that they not communicate regarding an internal investigation could interfere in the exercise of the rights of both union and non-union employees to engage in “concerted activities” and to discuss terms and conditions of employment. • Bottom line: Supervisors and investigators need to assess the precise need for secrecy and restrictions on employee discussion before demanding, or even suggesting, that employees keep information confidential during the course of an investigation.

27. Status Update on NLRB Posting Requirements NLRBissued a final rule on “Notification of Employee Rights under National Labor Relations Act” on August 25, 2011: Requires all employers covered by NLRA to post a notice which: • Informs employees of right to organize • Provides contact information for NLRB • Describes basic enforcement procedures Posting obligation is stayed pending further Court action stemming from legal challenges form employers: • Federal District Court: Found NLRB has authority to require posting • Appeal pending before D.C. Appeals Court, which heard argument on September 11, 2012 • District Court of South Carolina: Found NLRB exceeded authority • Appeal currently pending in Fourth Circuit Court of Appeals

28. 2012 UPDATE Connecticut Law & Decisions of Note

29. CT Legislature Legalization of Medical Marijuana • Cannot base employment decisions “solely” on the basis of user or caregiver status • Use not allowed “in the workplace” • No restriction on employer’s ability to “prohibit usage during work hours or to discipline for being under the influence during work hours” • CFEPA implications

30. CT Legislature Legalization of Medical Marijuana • ADA implications: “Current Users of Illegal Drugs” exclusion no longer applicable? • Exception to exclusion: “so long as drug is taken under supervision of a licensed health care professional, or other uses authorized by the Controlled Substances Act or other provisions of federal law.” • James v. City of Costa Mesa, No. 8:10-CV-00402-AG-MLG (9th Circuit, decided May 21, 2012)provides some insight into how courts may approach this issue

31. CT Legislature • A bill allowing government agencies to negotiate labor agreements on construction projects • A bill providing collective bargaining rights to certain home care and daycare providers in programs funded by the state

32. CT Legislature Paid Sick Leave (as of Jan. 1, 2012): • Mandates 40 hours of paid leave per calendar year for covered absences • Prohibits retaliation against employees who request or use sick leave • Posting requirement What we have learned so far: • The “safe harbor” provision is not so safe • Mandating work before or after a holiday in order to get paid may be alright • Attendance reward programs may be alright • Management training is key

33. CT Legislature Bills that came close to passing (and are thus reflective of trends to watch): • More amendments to the Personnel Files Act • Minimum Wage hike • Adding “unemployed” to the list of protected classes • Clarifying that CT FMLA applies to employers with 75 or more employees in the state. The CT Supreme Court will soon decide this issue in Velez v. CT Department of Labor (argued January 31, 2012)

34. Employee Speech: Public Employer Perez-Dickinson v. City of Bridgeport, 304 Conn. 483 (May 1, 2012) – clarifying the definition of actionable free speech vs. speech in an official capacity as an employee of a public employer in Connecticut Facts: • The plaintiff school principal sued the defendants, the Board of Education and two public school administrators, for violating C.G.S. Sec. 31-51q (CT’s “free speech” law) and inflicting emotional distress after she filed 2 reports of suspected child abuse and subsequently was demoted and allegedly wrongfully accused of abusing students herself. • The jury found in the plaintiff’s favor and awarded her $2 million.

35. Employee Speech:Public Employer Holding: • The CT Supreme Court reversed the jury verdict and directed a verdict in the employer’s favor. • The Court found that a public employee reporting suspected child abuse is not engaging in protected, actionable free speech but instead in an official, mandated capacity. • The Court also found that no reasonable juror could have found that the plaintiff suffered severe emotional distress where there was no evidence she was in distress for an extended period of time or that she sought medical treatment for the alleged distress.

36. Employee Speech:Private Employer Schumann v. Dianon Systems, Inc., 304 Conn. 585 (May 1, 2012) - clarifying the definition of actionable free speech vs. speech in an official capacity as an employee of a private employer Facts: • The plaintiff was a laboratory pathologist working for the defendant. He refused to use certain diagnostic codes for lab tests that were being performed, claiming that their use would impact patient safety. • He brought suit under C.G.S. Sec. 31-51q, claiming his refusal was protected free speech. The jury awarded him $10 million.

37. Employee Speech: Private Employer Holding: • The Court reversed the jury verdict and ordered a new trial. • Employees cannot bring “free speech” claims under CT law when the allegedly protected speech arises in the course of their job duties. The Court found that the plaintiff here was engaging in speech that was “part and parcel” with his job duties and, therefore, the speech was not protected by statute. • The Court reached same conclusion under CT Constitution, finding the speech unprotected because it was “extraordinarily disruptive” to his employment – it led him to refuse to perform a significant portion of his job duties, to the point of being insubordinate, and it strained his relationships with other employees.

38. Hostile Work Environment: Sexual Orientation Patino v. Birken Manufacturing Co., 304 Conn. 679 (May 15, 2012) – expanding hostile work environment claims to include sexual orientation Facts: • The plaintiff was employed by the defendant as a machinist. He claimed he overheard some of his coworkers calling him derogatory homosexual names. He initiated suit alleging the defendant violated C.G.S. Sec. 46a-81c – the section of the CFEPA prohibiting discrimination on the basis of sexual orientation – by failing to prevent its employees from creating a hostile work environment for him on the basis of his sexual orientation. • The jury found for the plaintiff and awarded him $94,500 in non-economic damages.

39. Hostile Work Environment: Sexual Orientation Holding: • The Court affirmed the jury verdict. In so doing, the court noted that discriminatory conduct does not need to be directed at the plaintiff or to his face to be actionable. • The Court also found that though not apparent on the face of the statute in question - which states nothing more than a prohibition on discrimination on the basis of sexual orientation in “the terms, conditions and privileges of employment” – does provide a basis upon which to bring a “hostile work environment” claim.

40. Wrongful Discharge Standard Armshaw v. Greenwich Hospital, 134 Conn. App. 134 (March 6, 2012) – Reiterating the standard for sustaining wrongful discharge claims Facts: • The plaintiff, an at-will nursing employee of defendant hospital, was discharged after multiple performance warnings when she continued to refuse to follow conduct and quality of work protocols designed to ensure the safety and proper care of hospital patients. • She sued under a theory of wrongful discharge, claiming in essence that she was discharged because she consistently advocated and acted to support proper critical patient care in emergency situations. • The CT appellate court affirmed the trial court’s grant of summary judgment for the defendant, holding that to sustain a common law wrongful discharge claim, the employee must show the discharge violated some important public policy that had been highlighted by the legislature, and the plaintiff here failed to do so.

41. Independent Contractors Young v. City of Bridgeport, 135 Conn. App. 699 (May 22, 2012) – clarifying that independent contractors cannot assert claims under C.G.S. Secs. 31-51q and 31-51m Facts: • The plaintiff was a city sheriff, elected to hold office for a term of 2 years, and had held the position for 18. He had no affirmative duties, no scheduled work hours and no office space in a city building. His role was to serve process on behalf of the city, something he also did for private individuals and entities. • He brought suit alleging violation of CT’s statutory protections against employers retaliating against employees for engaging in protected speech and for whistleblowing. The plaintiff alleged the city had terminated all of his employment duties and had stopped giving him process to serve after he reported suspected violations by the city of state laws and municipal ordinances. • The trial court directed a verdict in the city’s favor.

42. Independent Contractors Holding: • The Appellate Court affirmed, holding that the plaintiff was an independent contractor, not an employee and, as such, did not have standing to bring claims under either C.G.S. Sec. 31-51q or 31-51m as he was not an “employee” of the city, but rather was an independent contractor. • The Court reiterated that the “employee-control” test set forth in the 2004 Nationwide Mutual Ins. Co. v. Allen case still applied when determining whether an individual is an “employee” under CT law.

43. Post-Employment Actions Eagen v. CHRO, 135 Conn. App. 563 (May 22, 2012) – post-employment actions may be actionable Facts: • The plaintiff, an attorney for UCONN, appealed to the trial court from a decision made by the defendant CHRO. The decision in issue related to the termination of employment of a UCONN veterinarian. The plaintiff offered to supervise the packing and mailing of this veterinarian’s belongings to his home after termination. • Over 1 month post-termination, the plaintiff sent the veterinarian 24 boxes of his personal items. 1 month later, the veterinarian filed a whistleblower retaliation claim at the CHRO alleging that the plaintiff’s failure to return all of his personal belonging was in retaliation for whistleblower activities in which he had engaged while employed. • 3 weeks after this filing, the plaintiff had an additional 11 boxes delivered, then 1 month later, delivered still more items to him.

44. Post-Employment Actions Holding: • The CHRO found in favor of the veterinarian and awarded him $5,000 in damages for emotional distress for the plaintiff’s actions in delaying transmission of his belongings to him. On appeal to the Superior Court, this holding was upheld, finding that the behavior in question could be viewed as an “employment action” under applicable law.

45. Drug Testing Tomick v. UPS, Inc., 135 Conn. App. 589 (May 22, 2012) – Clarifying “reasonable suspicion” under the CT Drug Testing statute and when “qualified individual” assessment are made under the ADA • Among the issues decided by the Court involved whether an employee has a cause of action under the CT drug testing statute where s/he never actually takes a drug test (is just asked to do so by the employer but refuses). The Court concluded that the mere fact of making the request was sufficient to give rise to a claim under this law. • The Court also assessed when the analysis of whether an employee is a “qualified individual” within the meaning of the CFEPA disability discrimination prohibition is made, and found that occurred when the adverse employment action occurred, not the date when the termination process began.

46. Perceived Disability Desrosiers v. Diageo North America, 137 Conn. App. 446 (August 14, 2012) – Rejecting “perceived disability” cause of action in Connecticut Facts: • Federal law prohibits an employer from taking adverse action against an employee on the basis of a perception of the employee as being disabled, i.e. a “perceived disability.” • The plaintiff was terminated the day after she requested time off for surgery. The company’s stated reason was for inadequate performance reviews. She brought suit on a theory the company discriminated on the basis of her actual physical disability and/or a perceived disability. • The trial court granted summary judgment to the employer on the plaintiff’s perceived disability claim, holding that “a cause of action based on a perceived disability is not a legally recognized action in Connecticut.”

47. Perceived Disability Holding • The Appellate Court affirmed, holding that Connecticut’s anti-discrimination laws do not cover a “perceived disability” claim by an employee. • The court found that Connecticut law “protects those who are physically disabled, and no language is used to support an interpretation that it also protects those who are regarded as physically disabled.”

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