Court Defines “Overnight Stay” for FMLA Purposes

Under the Federal Family Medical Leave Act (“FMLA”) an employee with a “serious health condition” may be entitled to up to 12 weeks of unpaid leave and reinstatement when leave expires.  The regulations for the FMLA define a “serious health condition” as including a situation where an employee has received “inpatient care,” which means “an overnight stay in a hospital, hospice, or residential medical care facility.”  Last week, the Third Circuit Court of Appeals addressed the question of what qualifies as an “overnight stay” for purposes of coverage under the FMLA.  The Court held that an “overnight stay” means a stay in a hospital, hospice, or residential medical care facility “for a substantial period of time from one calendar day to the next calendar day as measured by the individual’s time of admission and his or her time of discharge.”  Based on this definition, the plaintiff-employee did not have a “serious health condition” because he was admitted and discharged on the same calendar day.  And, without a “serious health condition,” the plaintiff-employee did not have a basis to assert claims under the FMLA.  Employers should always carefully review documentation provided by employees in connection with medical leave (including admission and discharge information).

What Makes a Non-Competition Agreement “Voidable” under ORS 653.295

The Oregon Court of Appeals recently examined when a noncompete will be voidable because employer did not provide two weeks advance notice to a prospective employee that she would be required to sign a noncompete.  ORS 653.295 states: “(1) A noncompetition agreement entered into between an employer and employee is voidable and may not be enforced by a court of this state unless… The employer informs the employee in a written employment offer received by the employee at least two weeks before the first day of the employees employment that a noncompetition agreement is required as a condition of employment…”

The primary issue on appeal was whether an employer’s failure to comply with the two-week notice rule rendered the noncompete void or voidable.  The Court found that use of the word “voidable” in the statute means that an employee must take affirmative steps to void a noncompetition agreement at the time the employer seeks to enforce the noncompete in order for the agreement to be unenforceable because the employer did not give two weeks advance notice.  In the absence of taking such affirmative steps, the noncompetition agreement remains valid and enforceable.

From a practical standpoint, the case establishes that an employer’s failure to provide two weeks advance notice of a noncompete may not be fatal to enforcement.  However, if an employee takes steps to void the noncompetition agreement because of the employer’s failure to comply with the statute, the agreement will be not be enforceable (and the failure to follow the statute will be fatal to enforcement).

Oregon “Ban the Box” Developments

Nationwide, there is a movement to prohibit employers from asking questions about criminal convictions in employment applications because such questions screen a disproportionate number of otherwise qualified minority applicants from consideration for jobs.  Last week, the Oregon house considered proposed “ban the box” legislation.  House Bill 3025, as amended, would make it an unlawful employment practice for an employer to: (1) use job application forms that inquire into the conviction history of an applicant for employment; (2) inquire into or consider the conviction history of an applicant for employment prior to conducting an interview with the applicant; or (3) inquire into or consider the conviction history of an applicant for employment prior to making a conditional offer of employment to the applicant when no interview is conducted.

House Bill 3025 now moves to the Oregon Senate. We will keep you updated on developments.  Or you can follow the bill by signing up for updates here:

Too Pretty to Work on an Oil Rig?

It is often difficult for a female applicant for employment to prove that an employer refused to hire her because of her gender.  In a recent case, the female applicants did not have such difficulty – they presented evidence that the employer told female applicants that it does not hire women because it only has “‘man camps,’ that women were ‘too pretty’ and that their presence would ‘distract the men.’”   This evidence led to a $400,000 settlement with the EEOC and is a reminder (not that one is really necessary) that employers cannot refuse to hire women, no matter how distracting their presence might be to male co-workers.

EEOC Issues Guidance on Employee Wellness Programs

Next week, the EEOC will publish proposed rules addressing how the ADA applies to employee wellness programs that are part of group health plans and that include questions about employees’ health or medical examinations.  In the interim, the EEOC has issued a Fact Sheet for Small Business and Questions and Answers for the general public. The big issues addressed include: what constitutes a wellness program; medical exams and inquiries in the context of employer sponsored wellness programs; incentives for participation; and confidentiality of medical information provided in connection with wellness programs.

The fact sheet is here:

Q & A here:

Don’t Transition Transgender Employee out the Door

To date, the EEOC has filed two lawsuits against employers for discriminating against transgender employees.  Today, a settlement was announced in one of the two cases.  The settlement requires the employer to pay $150,000, implement a new gender discrimination policy, and provide training to management and employees “regarding transgender/gender stereotype discrimination.”  In the lawsuit, the EEOC alleged that the employer terminated the employee after she began to present as a woman and notified the employer that she was transgender.  The employee had previously performed satisfactorily and was terminated only after she began to transition from male to female.  From the EEOC’s perspective, the employer’s actions constituted discrimination on the basis of sex, “which includes non-conformance with gender stereotypes.”

It’s Different for Employees in California

In California, with a few very narrow exceptions, any contract that restrains anyone from engaging in a lawful profession, trade or business of any kind is void.  Cal. Bus. & Prof. Code § 16600.  As a result, non-competition agreements with employees are typically unenforceable.  Earlier this week, the Ninth Circuit Court of Appeals looked at the issue of whether a “no-employment” provision in a settlement agreement between a doctor/employee and his former employer (a large consortium that manages and staffs hospitals, clinics and facilities) was an illegal restraint.  The “no-employment” provision barred the doctor from seeking employment with his former employer, as well as any facility owned, managed or contracted with his employer.  The provision also permitted the doctor to be terminated if the former employer acquired an ownership interest in, or began to manage, a facility where the doctor worked in the future.

The lower court found that the “no-employment” provision in the settlement agreement was not a covenant not to compete because it did not preclude the doctor from working for a competitor of his former employer or at another hospital or facility not operated by his former employer.  The Ninth Circuit disagreed.  The Court found that Section 16600 prohibits covenants not to compete as well as other contractual restraints on professional practice, and remanded the case to determine whether the “no employment” provision constituted “a restraint of substantial character on [the doctor’s’ medical practice.”

For employers with employees in California, this decision suggests that any provision in an employment agreement or settlement agreement that substantially restrains an employee’s ability to engage in their profession, trade, or business, will be subject to challenge.

Second Guessing A Doctor’s Release

A recent EEOC settlement highlights the risk of ignoring a doctor’s full release.  According to the EEOC, the employer refused to return an employee to his job after the employee had a heart attack. The employee was released to work by his doctor with no restrictions but the employer refused to put him back to work (except for two days).  The EEOC alleged that the employer violated the ADA because it discriminated against the employee based on actual or perceived disabilities.  The EEOC release does not include the employer’s explanation for its actions, only that the employer paid $50,000 to resolve the claims.  However, the case is a reminder to employers not to substitute their own perceptions of an employee’s ability to work, for an employee’s doctor’s opinion (unless the employer is also the employee’s doctor – a situation that the EEOC has not yet addressed).

U.S. Supreme Court Rules on Pregnancy Discrimination

Yesterday, the U.S. Supreme Court issued an opinion in Young v. UPS, in which it addressed the Pregnancy Discrimination Act’s requirement that employers treat pregnant employees the same way they treat other employees in the same job.  The Court held that an individual pregnant worker who seeks to show disparate treatment may make out a prima facie case by showing that: she belongs to the protected class; she sought accommodation; the employer did not accommodate her; and the employer did accommodate others “similar in their ability or inability to work.” The employer can respond with legitimate nondiscriminatory reasons for denying accommodation which the employee may then rebut by showing the stated reason is pretextual.  The Court then held that the plaintiff created a genuine issue of fact as to whether UPS provided more favorable treatment to at least some employees whose situation cannot reasonably be distinguished from hers.

As a practical matter, based on the Court’s decision, employers should tread very carefully when applying “light duty” policies and should not restrict light duty positions to employees with work-related injuries.

The decision is here:

Managing/Terminating Toxic Employees

The Portland Business Journal has an interesting article about how to manage toxic employees who are also superstars.  The article recommends that an employer’s approach to the toxic employee should take into account both the mission and goals of the employer.  The employer’s approach should also involve consulting with counsel to consider the legal risks of terminating the employee, and whether it is possible to minimize those risks.  For example, if you have a toxic employee whose bad behavior has not been well documented, putting the employee on a performance improvement plan could satisfy the goals of the employer and reduce legal risk: it gives the employee a chance to correct the toxic behavior and let’s the employer  remedy its lack of documentation for the employee.  The article is here: