Harassment claims: what do you do if you can’t tell what really happened?

Michael G. Trachtman Powell Trachtman, P.C. MEA General Counsel mtrachtman@powelltrachtman.com Balancing the Rights of the Accuser vs. The Rights of the Accused Here is the “damned if you do and damned if you don’t nightmare” employers facing harassment claims must often confront… The accuser levels a serious harassment charge. The accused vehemently denies the accusation. Both the accuser and the accused threaten major lawsuits if the employer fails to take action, or sides with the other. There is nothing close to “smoking gun” evidence that points to the truth. Now what? Recent events have highlighted this conundrum in the sexual harassment context, but it applies to any category of unlawful harassment claim, such as harassment based on race, age, religion, nationality, disability and so on. I discussed this problem previously in The Harvey Weinstein/Bill O’Reilly/Matt Lauer Effect, and generally described the approach that employers must utilize to navigate these waters. As our national culture shift on this issue continues to unfold, particularly involving sexual harassment, I thought it would be helpful to delve further into the specifics. Why? The stakes are monumental: the accuser has certain legal rights which, if not respected by the employer, can lead to a debilitating damage award, even including payment of the accuser’s legal fees; the accused has legal rights as well, including the right to bring a defamation action if, for example, the employer’s unjustified endorsement of the accuser’s claim shatters the accused’s career or family relationships. The “Before and “After” Legal Requirements Think of the law’s requirements in two contexts: what happens before and what happens after a harassment claim surfaces. I...

The Harvey Weinstein/Bill O’Reilly/Matt Lauer Effect

What to Expect from Women – And Men – And What To Do About It Thanks to the Harvey Weinsteins, the Bill O’Reillys, the Matt Lauers (the Charlie Roses, the Al Frankens…) of the world, we are in the midst of sexual harassment culture shift, and the effect on the workplace will be complicated, confusing, and risky. What To Expect: More Bona Fide Claims… And a Bandwagon Effect Recent surveys have revealed the plethora of women who have experienced sexual harassment in the workplace – by some accounts, 40% or more. In the past, fear of retaliation, shame, and the risk of stigmatization has dissuaded many, some say most women from speaking up. But as more and more women in high-profile cases have come forward, had their claims validated, and been lauded for their courage, women in workplaces everywhere have been encouraged and emboldened to break their silence. The inevitable result, which is already evident, is that many employers will face a growing wave of sexual harassment claims – some arising from past conduct, some arising from present conduct. Past is usually prologue and, based on history, that wave will not peak for some time: when the media begins to publicize the fact that people who sue for X (an automobile defect, a pharmaceutical side effect … ) are obtaining substantial damage awards, lots of other people will want to jump on that bandwagon and sue for X as well. Some will bring real claims, some will bring questionable claims, and, inevitably, some will bring bogus claims in the hope of obtaining a nuisance settlement. How Employers Must Prepare...

Making employment law great again…?

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com We are well into the Trump administration, and despite the well-publicized paucity of Congressional legislation, there have been, and will be, significant changes in the laws that define the employer/employee relationship. Employers would be well-advised to make the appropriate adjustments now, while there is time to plan, and not just react. To assist in that effort, here is a summary of where we are, and where we are going. (I discussed much of this at the MEA HR & Employment Law Conference in September. Contact MEA if you are interested in receiving a copy of my PowerPoint presentation.). The Republican Majority in Congress While the Republican majority in the House and Senate has not resulted in the enactment of meaningful legislation, it portends some very significant employment law changes that may reverberate through the workplace for years, and in some instances decades. It is too early in the game to be specific, but particularly because of key personnel changes, it is fair to predict a more restrictive view and interpretation of employee rights for the foreseeable future, with some notable exceptions, like pay equity and parental leave, explained below. Congressional committees are now chaired by Republicans, not Democrats. That will change the nation’s legislative agenda on everything from unionization rights, to healthcare, to harassment and discrimination laws, to environmental restrictions … and much more. There is a perception that the Obama administration swung the employment law pendulum too far to the left, and that it is time to swing it somewhat back to the right....

LGBT rights in the workplace

Does Anyone Know the Rules … and What About Religion? On the question of LGBT rights (actually, LGBTQQIAAP rights … you can look it up), federal law, the EEOC, some courts, other courts, state laws, local laws, Trump, and the military cannot seem to get on the same page. As an employer, particularly in view of the potential liabilities, what page should you be on? Discrimination: How Can You Follow the Law if No One Knows What it Is? Here is a summary of the discrimination legal landscape, rife with minefields and alligators … but at the same time, some things are coming into focus. Federal law (mainly, the comprehensive statute known as Title VII) prohibits discrimination on the basis or because of sex, but it does not specifically prohibit discrimination on the basis of sexual orientation, or discrimination against transgender individuals, or discrimination on the basis of gender identity or expression. However, the clear trend (with some hold-outs) is to interpret discrimination on the basis of “sex” to include discrimination based on sexual orientation and transgender status.  For example, a Federal Court in western Pennsylvania ruled that an employer unlawfully discriminated on the basis of sex by terminating an employee, a male, for presenting at work as a female, and for terminating an employee based on sexual orientation. The EEOC, the federal government’s primary enforcement arm, takes the position that discrimination on the basis of sexual orientation, discrimination against transgender individuals, and discrimination based on gender identity or gender expression is In practice, that means that, today, the EEOC will initiate an action against an employer who, for...

Cybersecurity: A Seven-Step Plan For Business Survival

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com First, the bad news…  There is an evolving, insidious breed of cyberattacks that pose risks beyond the damage awards, regulatory agency fines, injunctions, and criminal sanctions I wrote about in the March 2017 Workplace Advisor. These are cyberattacks that are existential in nature – they can severely compromise or, often, put a company entirely out of business, virtually overnight. Now, the (sort of) good news…  There are strategies that, while not perfect, can be of very significant help. The proper design and implementation of these strategies will require both legal counsel and technical expertise — some law firms, like my firm, partner with cybersecurity consultants to provide a “one-stop” resource.  The failure to utilize these strategies involves a gamble most businesses cannot afford to take. What Are the Sources of the Risks? The threats come from the inside and the outside. On the inside, employees are a constant source of risk.  Sometimes the motive is purely financial – competitors will hire employees who can deliver valuable data, and the Internet “black market” pays cash for login, credit card, banking, intellectual property, social security numbers and other sensitive information.  Employee ignorance and negligence is a major issue as well — employees fall prey to phishing schemes, they are careless with their selection and protection of passwords, and they lose laptops and thumbdrives.  And, sometimes, employees vandalize systems and data out of pure revenge for perceived mistreatment. On the outside, “phishing” schemes – emails that induce a computer user to click on an attachment, a link or...

Summer Interns: No Good Deed Goes Unpunished

Michael G. TrachtmanPowell Trachtman Logan Carrle & Lombardo, P.C.MEA General Counselmtrachtman@powelltrachtman.com Most of us have been there: a fresh-faced student asks – even begs – for the opportunity to do odd jobs in your workplace, for free, just to get some real-world experience. You don’t need anyone (and, in fact, the student will probably get in the way) but, perhaps remembering your own student days, you agree. And, for sure, it feels good to have helped an ambitious young person make their way in the world … right up until the time you get sued for violating the Fair Labor Standards Act. There have been a slew of high-profile cases involving unpaid interns, and the effect of those cases has been an ever-increasing proliferation of less-publicized but very expensive cases against smaller companies. Some of the recent headline-grabbers (against companies with monumental legal staffs who should have known better) include: Conde Nast (publisher of high-end magazines like Vogue and Vanity Fair), agreed to a $5.8 million settlement in a class action lawsuit brought on behalf of approximately 7,500 unpaid/underpaid interns. Two Fox companies settled a lawsuit on behalf of 139 unpaid interns who worked on a movie, The Black Swan, for two weeks. Viacom settled a lawsuit brought on behalf of 1,311 unpaid interns for $1.6 million. Charlie Rose settled a lawsuit brought by unpaid interns who worked on the “The Charlie Rose Show”. And so on … similar suits have been filed against Atlantic Records, W Magazine, the website Gawker, Fox Soccer Channel, among others. In July 2015, the Guardian reported that, as is typical in political campaigns,...

Cybersecurity: The Legal Risks

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com A Megabyte of Prevention is Worth a Terabyte of Cure The Russian hacking of the Democratic National Committee. WikiLeaks and the CIA. The monumental data breaches at Yahoo, LinkedIn, the IRS, the Department of Justice… Cybersecurity has been one of the primary headline-grabbers of the past year. But what does any of that have to do with a privately owned business without tens of thousands of employees or a national profile?  Regrettably, a whole lot. Most businesses understand that cybersecurity “holes” can lead to suffocating operational issues – for example, ransomware that locks a business out of its databases until a ransom is paid, malware that changes data or deletes files, spyware that allows a competitor to copy your most sensitive information. But what is not as widely understood is this: even if your cybersecurity deficiencies have no effect on your operations, they can lead to colossal legal liabilities, including damage awards, regulatory agency fines, injunctions and, even, criminal sanctions. It is important for businesses to become aware of the source and scope of these legal risks, which is the first step in the development of a preventive strategy that will ultimately require a partnership between competent IT professionals and knowledgeable counsel. Toward that end, summarized below are some of the most important cyber-traps in the legal landscape – the initial focal points for any cyber-liability avoidance program. The Federal Trade Commission Perhaps the most common form of cyber-liability involves the inadvertent disclosure of, or the failure to protect from hackers, sensitive consumer information (such as name,...

Making Molehills Out Of Mountains: Avoiding The $1 Million Harassment Claim

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com Sooner or later, almost all companies will face claims by employees who assert that they were unlawfully harassed.  There are many reasons for this, among them the fact that the legal basis for harassment claims have expanded (especially at the state level), and the political climate has led to a definitive spike in harassment claims based on nationality and religion.  In some companies, these claims lead to six, even seven-figure judgments; in other companies, the typical outcomes are much more favorable.  There’s a reason for this disparity, and the failure to understand that reason can decimate a bottom line. Death By Cross-Examination Consider this scenario…  An employee files a harassment claim, and you (the director of HR, the department head, perhaps the CEO) are called to testify by the employee’s attorney. The attorney begins by asking you if you care about worker safety.  Yes, you answer.  He asks if you have written safety procedures.  Yes, you do.  He asks if, in addition, you train workers on the proper use of machinery and materials in order to avoid workplace injuries. Yes, of course, you answer.  And that’s because you understand that it takes training, not just words in a manual, to make sure that important workplace policies are understood and respected, right?  Yes, training is important, you admit. He then asks if you think it’s important to protect workers from unlawful harassment. Of course, you tell him. He asks if you would agree that unlawful harassment can cause significant damage to an employee – humiliation, loss...

Important: The EEOC Has Published Its Position On Whether Employers Must Provide Extra Unpaid Leave To Disabled Employees

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com The Americans with Disabilities Act requires that an employer must provide a “disabled” (which is very broadly defined) employee with a reasonable accommodation to enable the employee to do his or her job.  But what if the disabled employee demands unpaid leave in addition to the employer’s allotted paid time off?  If the purpose of an accommodation is to enable an employee to do the job, how can an employer be required to provide an accommodation that takes the employee off the job. Employers, their counsel and the courts have struggled with this issue since the inception of the ADA in 1990.  In May 2016, the EEOC finally weighed in, and issued a lengthy paper “to provide general information to employers and employees regarding when and how leave must be granted for reasons related to an employee’s disability…”.  The EEOC’s position is not law (and courts often disagree with the EEOC’s pronouncements).  But, for now, the paper tells us how the EEOC will apply the ADA until a court or Congress says otherwise – and that provides valuable guidance for employers seeking to avoid the draconian impact of an unforeseen and, often, unforeseeable ADA violation. Here is the basic message of the ADA: an employer must provide unpaid leave (even if the employee is not entitled to leave under the employer’s policies) as a reasonable accommodation unless doing so will cause an undue hardship (and the law is clear that the hardship must be severe in order to be “undue”). The rule raises as many...

The Power of Job Descriptions: Do Them, and Review Them

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@poweltrachtman.com Job descriptions are the Rodney Dangerfields of the workplace – they don’t get no respect.  In fact, however, a properly drafted job description can be a legal life-preserver that can save tens, even hundreds of thousands of dollars in potential liabilities and legal fees.  Consider these two, very common scenarios. The ADA Scenario Suppose you have a loading dock supervisor, Isaiah Hertz (think about it …) who suffers a permanent back injury and cannot lift more than 20 pounds.  Your obligation under the ADA is to determine if there is any reasonable accommodation that will allow Hertz to perform the essential functions of his job – if there is, you must provide the accommodation, but if there is not, you may replace him.  Remember that the ADA does not require you to change the essential functions of the job to suit his disability. You know that 50% of Hertz’s job entails loading and off-loading boxes from trucks, most of which weigh over 20 pounds.  There is no possible reasonable accommodation – this is a central aspect of his job, and he can either do the job, or not.  You offer Hertz a different, lower paying position.  He refuses.  You terminate him.  A week later, you get notice that he filed an ADA claim against you. Hertz claims that the ability to lift 20 pounds is just a tangential part of his job, and not one of the essential functions, all of which he can still perform.  As proof, he submits your offer letter, sent two...

The Trump Triumph: A Fearless Forecast for the Workplace

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com In the July Workplace Advisor article, I took a shot at broadly analyzing what a Clinton or Trump administration would mean for workplaces.  Much of what I said then continues to hold true, particularly in respect to the Supreme Court, but in the aftermath of the election, and despite the fact that Trump has put forth few specifics respecting workplace policies or programs, some of the key issues and indicators are now coming into sharper focus. Surprises and uncertainties are the bane of any business, and I offer the below, a kind of workplace prognosis, in the spirit of helping businesses, particularly closely held businesses, prepare for future.  Hopefully, I will do better than the pollsters… Trump will be reluctant to bite the hands that fed him. The demographics of the Trump victory turned party politics inside out.  Trump, the Republican, was elected by what has been a bastion of Democratic support – middle class working people seeking to get their fair share of the pie.  Union leaders may have supported Clinton, but union members supported Trump. While Trump most certainly seeks to favor businesses, he will remember how he got where he is, and that will influence his policies. Expect some inconsistencies as Trump attempts to serve two masters. A wildcard:  will he support the existing enforcement push on ADA and FMLA violations, improperly classifying independent contractors, and payment of overtime for “off the clock” hours?  These are all policies favored by working people and despised by businesses.  It will be interesting to see...

Buying or Selling a Business? Note These Six Workplace Issues That Can Make or Break the Deal

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com When you are buying or selling a business, price is, obviously, a driving factor.  But what buyers and sellers often ignore when valuing a business, particularly a closely held business, is the extent to which under-the-radar workplace issues can affect the business valuation – and, even, the deal itself – sometimes with disastrous results. Is The Due Diligence Diligent Enough? Business buyers and sellers frequently start the process of calculating the value of a business, and therefore its sale price, by utilizing various financial formulas. The buyer will, then, engage in a “due diligence” process – a detailed analysis of the business — in the effort to determine if there are any factors that should cause the buyer to pay more or less than the formula price, or whether the buyer should back out altogether. This is the point where many buyers ignore the importance of the workplace and, as a result, they overpay, and/or they spend years dealing with recurring, expensive workplace-related issues they never factored into their business plan. And on the other side of that coin, when a savvy buyer does conduct the right kind of due diligence and becomes aware of the workplace issues, this is the point where the buyer can force the seller to accept a significantly lower price than the seller had been counting on, assuming the buyer is still willing to buy the business. Business Buyers and Sellers Beware In no order of importance (since that would depend on the particulars of the business being bought and...

The Effect of the Fox News Scandal: Identifying and Fixing What “Ailes” Your Workplace

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@powelltrachtman.com The EEOC’S survey data indicates that 25% to 75% (depending on how the survey questions are phrased) of all female workers are victims of sexual harassment, and that roughly three out of every four never report it, usually because of the fear of retaliation or the belief that their allegations will be discredited or ignored.  If past is prologue, however, there is a very good chance that, as a result of the now-infamous Fox News\Roger Ailes scandal, a much greater percentage of sexual harassment victims will be more willing to follow through with sexual harassment claims.  The likely result: employers which have not proactively identified and pre-empted the sources of potential (and often very subtle) sexual harassment in their workplaces will pay the price. What Happened, and Why It’s Different Roger Ailes, the founder and chairman of Fox News, was (among other positions of influence) one of the most powerful media figures in the world.  A former Fox News anchor, Gretchen Carlson, accused Ailes of sexual harassment.  Several other women employed by Fox News (such as the popular Megyn Kelly) then made similar allegations (while others sprang to Ailes’ defense), and in a matter of days, Ailes had “resigned,” accompanied by a monumental frenzy of media coverage and punditry. Allegations of sexual harassment against men who hold powerful and influential positions are nothing new, but the Ailes case is different. Most of these claims (many of which, it must be stressed, are ultimately proven to be shake-downs) follow a predictable pattern.  The accused vigorously denies...

The Presidential Election: How Will It Affect Your Workplace and Your Business?

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@poweltrachtman.com The 2016 election will be extremely consequential for businesses in general, but especially for small (i.e., under 500 employees) businesses. Setting aside the party stereotypes and the negative, sometime visceral reactions both candidates seem to engender, the question is whether one party and candidate will be materially better for business than the other.  Especially when it comes to small businesses, that is not an easy question to answer.  But getting it right has rarely been more important. What follows is my effort to highlight, from a lawyer’s perspective and without regard for the “common wisdom” that is so often wrong, three of the issues that small business owners should seriously consider when making their choice. The Supreme Court The Supreme Court under Chief Justice Roberts is the most pro-business Court in decades – according to some analysts, the most pro-business Court since the 1930s. Many of the Supreme Court’s headliner decisions have been decided by a 5-4 margin: four Republican-appointed “conservative” justices are on one side; four Democratic-appointed “liberal” justices are on the other side; and Justice Kennedy, the “swing vote,” is in the middle.   This has been the pattern in, for example, the decisions on campaign finance reform, gun control, same-sex marriage, religious freedom, abortion, affirmative action … and many more.  (Shameless plug:  I deal with these and related issues in a newly revised edition of my book, The Supremes’ Greatest Hits, which will be released in September.) However, while the Roberts Court, as a whole, has been decidedly pro-business, the Democrat\Republican — liberal\conservative...

The Secrets to Keeping Your Secret Sauce Secret

Michael G. Trachtman Powell Trachtman Logan Carrle & Lombardo, P.C. MEA General Counsel mtrachtman@poweltrachtman.com   You fire your sales manager, and then find out that she downloaded to her personal computer a copy of your confidential customer and sales history database.  You hire a computer consultant who, you later discover, copied your proprietary software, and you suspect the consultant might be using it as part of his consulting practice.  You discover that a competitor is using CAD files that had to have come from your company.  What can you do?  The answer is: a lot, so long as you do it in the right way. In May 2016, Congress enacted the Defend Trade Secrets Act (DTSA).  The statute can provide you with substantial protection against the theft or unauthorized use of your trade secrets by, for instance, employees, independent contractors, consultants and competitors.  Here’s what you need to know. What’s a “trade secret”?  The definition of a “trade secret” is fairly loose:  it is information that provides economic value to a business, and that the business attempts through reasonable means to keep confidential.  So, just by way of example, if you have a valuable manufacturing method, a unique formula, a proprietary customer database, and so on, and if you use reasonable efforts so that only those with the need to know have access to that information, it would likely qualify as a “trade secret.” What’s the impact of DTSA?  Most states already have trade secret laws that, upon the theft of a trade secret, provide for injunctions, damages, punitive damages and, sometimes, attorneys’ fees.  However, when trade secrets are...