Monday, November 30, 2015

No Peace for Peace Corps Volunteers – The “Sinister” Firing of Kellie Greene

On February 22, 2012, our client, Kellie Greene, became the inaugural Director of the Peace Corps Office of Victim Advocacy, an office newly created by the passage of the Kate Puzey Peace Corps Volunteer Protection Act of 2011. The Kate Puzey Act was born from Kate Puzey’s murder, a tragedy that exposed the Peace Corps’ long history of failing to protect its volunteers from serious crimes and its deep-seated culture of victim blaming. (For ABC’s 20/20 report on this, click here.) The Kate Puzey Act created Kellie’s position for the single purpose of overhauling the Agency’s old guard mentality and to transform the agency into one that cared about volunteer safety. Kellie vigorously attempted to do just that: she confronted Peace Corps about its practice of limiting counseling sessions for victims; she confronted Peace Corps’ practice of involuntarily separating volunteers who became victims of crimes; and she confronted Peace Corps about lecturing sexual assault victims about their alcohol consumption. This morning, CBS aired its interview of Kellie, in which she described how she “pushed the Agency to really do what they have the capability of doing”, and how she was so frustrated by the Agency “because they have the ability to do this and it is a choice not to.”

For her advocacy, Kellie faced an outpouring of hostility within the Agency. On April 29, 2015, Peace Corps managers stripped Kellie of her supervisory duties and exiled her from OVA. This action in and of itself violated the Kate Puzey Act, which requires that Kellie report directly to the Director at all times. On April 30, 2015, Peace Corps delegated “all official OVA business matters” to Kellie’s subordinate, who was less committed to victims’ rights and whom the Agency felt was more popular with its staff. On October 5, 2015, the Agency notified Kellie that it was proposing her removal, placed her on administrative leave, and escorted her out of the premises. The proposal itself is rife with unlawful reasons for removing Kellie. It found that other Agency offices did not “like” her. In contrast, the Daily Beast reporter found in his discussions with Peace Corps volunteers that Kellie was well-liked by them, because they felt she was on their side. (For the full article, click here.) Congressman Ted Poe (R-TX), one of the architects of the Kate Puzey Act, opined that the Agency’s action against Kellie “looks very sinister… based on what I know… She… may have asked too many questions.” On November 9, 2015, Peace Corps decided to “mitigate” its penalty to a 120-day suspension.

To put the Peace Corps’ penalty in perspective, other federal employees, some of whom were accused of verbally abusing or publicly humiliating their subordinates, were penalized with 30 day suspensions or less. See, e.g., Hughey v. Dep’t of Treasury, 59 MSPR 480; Gores v. VA, 68 MSPR 100 (1995). Here, Peace Corps accused Kellie of disrupting the Agency culture; in essence, of doing her job.

Kellie’s whistleblower retaliation claims and other disclosures are currently before the Office of Special Counsel, an independent government agency tasked with prosecuting violations of the Whistleblower Protection Act of 1989. For a copy of the Peace Corps’ proposal to remove Kellie, our response, and their final decision, click here, here, and here.

For more information about this post or how you can protect your rights, please contact Nina Ren.

We have written quite extensively about whistleblower rights before:

Tuesday, November 24, 2015

Huge Tax Bill After Huge Back Pay Award? EEOC Provides Relief

Here’s the scenario: a federal employee prevails on an EEO complaint and as part of the relief is entitled to back pay.  Because EEO complaints can take several years to reach a final decision, it is not uncommon for back pay to total more than $100,000 when the dust settles.  The employee will receive that award as a lump sum; if as a result the employee’s income for that year has been pushed into a higher tax bracket, he or she will have to pay more tax than if the income had been earned as it should have been.  Can anything be done about this?

In fact, the EEOC takes the position that, “where an agency pays back pay and other income payments in a lump sum payment, the agency is responsible for a petitioner's proven increased income tax burden. . . . an award to cover additional tax liability for receipt of back pay in a lump sum is available and [] a complainant bears the burden to prove the amount to which he claims entitlement.” Lonnie H. v. Postmaster General, EEOC Appeal No. 0120111230, 2015 WL 6689996, slip op. at *7 (October 22, 2015), citing Goetze v. Dep't of the Navy, EEOC Appeal No. 01991530 (Aug. 22, 2001); Holler v. Dep't of the Navy, EEOC Appeal Nos. 01982627 & 01990407 (Aug. 22, 2001).

The consequences of this principle – to both employees and the federal agencies that employ them – are significant.  In a recent case, we obtained a decision that the FAA had failed to accommodate an Air Traffic Controller, forcing him to retire in January 2010 rather than in September 2013, as he planned.  The EEOC’s Administrative Judge ordered the Agency to pay back pay, including premium and overtime pay, for the 3 years and nine months of his retirement, minus the annuities he received.  In other words, wages that would have been received over four years were received in a single tax year. The gross back pay, before deductions, exceeded $500,000, and the tax will be calculated at the highest tax rate applicable to both his federal and state returns.  It would not be surprising if the tax consequence in this instance approached $100,000.

The EEOC’s approach has become much more clear, and robust, over the past 6 months.  In Marlin K. v. Dep’t. of Homeland Security, EEOC Appeal No. 0120132637, 2015 WL 6957093 (October 30, 2015), after the Agency accepted the Administrative Judge’s decision finding discrimination and awarding back pay, the employee expressed to the Administrative Judge his concern with the potential back pay consequences.  The Administrative Judge did not modify the decision, and the employee appealed solely on the issue of his tax liability.  According to the Commission, “where an Agency pays back pay and other income payments in a lump sum payment the Agency is responsible for a petitioner's proven increased income tax burden.” 

Although in Marlin K. the employee had alerted the Agency and the Administrative Judge to his tax concerns prior to his appeal, the failure of the employee to raise these concerns prior to the Administrative Judge’s decision does not relieve the Agency of its liability.  In Lonnie H., above, the employee was awarded back pay for 5 years and other elements of relief.  Eventually, the employee filed an enforcement petition complaining that the Agency had failed to grant all of his relief, citing the impact of the increased tax burden.  The Agency disputed the employee’s contentions, and with respect to the tax burden, the Agency noted specifically that it had not been ordered to assume the employee’s tax liability and, thus, wasn’t responsible.  The Commission, however, did not adopt the Agency’s reasoning.  Rather, the Commission held that the employee had failed to meet his burden of proving whether he had an increased tax liability and, if so, the amount of that liability.  Specifically, “what Complainant was required to demonstrate was the amount of his tax liability had he been working during the relevant portions of tax years 2002 to 2007; the amount of his tax liability in tax year 2009 due to the lump sum payment; and the difference between those two figures. That dollar amount would represent his increased tax liability.” Lonnie H., slip op. at *8.

The Commission has clearly advised employees what they must do to meet their burden of proving increased tax liability. In Complainant v. Postmaster General, EEOC Request No. 0520150187, 2015 WL 3484628 (May 22, 2015), the employee prevailed on a discrimination claim but appealed the relief awarded by the Agency.  The Commission affirmed the Agency’s award, and denied the employee’s reconsideration request.  However, although the issue was not raised by the employee, the Commission added the following to its Order:
3. After the Agency has calculated and paid Complainant's back pay award, Complainant shall have sixty (60) calendar days following the end of the tax year in which the final payment is received to calculate the adverse tax consequences of any lump sum back pay awards, if any, and notify the Agency. Following receipt of Complainant's calculations, the Agency shall have sixty (60) days to issue Complainant a check compensating her for any adverse tax consequences established, with a written explanation for any amount claimed but not paid.
Id., slip op. at *3.

At this point, the Commission’s position is clear: anytime an employee receives a lump sum back pay award, by March 1 of the following year the employee must provide to the Agency any calculations indicating that the lump sum has resulted in a higher tax bill than would have been paid had the wages been received normally.  The employee may want to obtain professional assistance for these calculations, but the Agency is not obligated to reimburse any fees incurred in this process.  The Agency thereafter has 60 days to pay the increased burden, or explain in writing why any part of the calculation has been rejected.  Presumably, the employee can appeal this determination.  The employee is not required to raise this issue prior to receiving the lump sum.

Employers have long been required to provide “make whole” relief to victims of discrimination.  Now, “make whole relief” includes any increased tax liability resulting from the employee’s prevailing in the first place.

(On September 17, 2015, Representatives John Lewis (D-GA) and Jim Sensenbrenner (R-WI) introduced H.R. 3550, the Civil Justice Tax Fairness Act of 2015 (CJTFA). Senators Susan Collins (R-ME) and Ben Cardin (D-MD) introduced the Senate bill, S. 2059.  The bills would allow employees receiving lump sum awards to average their income through amended returns, paying the taxes retroactively for the relevant years.  This approach would eliminate the higher bracket in the year the lump sum is received and, presumably, save the employer from further reimbursing the employee for the tax liability.)

For more information about this post or how you can protect your rights, please contact George Chuzi.

Want more on taxes? Read our other blog posts on this subject:

Monday, November 23, 2015

KCNF Announces New Partner Richard Renner

Whistleblower attorney Richard Renner has been elected Partner in the Washington, D.C., law firm of Kalijarvi, Chuzi, Newman & Fitch, P.C. (KCNF).

Renner has been an attorney for 34 years and has been associated with (KCNF) since 2013. He practices extensively in whistleblower matters before the U.S. Department of Labor, and in federal trial and appellate courts. He also handles discrimination, retaliation, and other personnel matters for federal and private sector employees and employers.

At KCNF, Renner was the lead attorney in a successful appeal under the Sarbanes-Oxley Act, Wallace v. Tesoro Corp., 796 F.3d 468 (5th Cir. 2015). He submitted successful amicus briefs for the Supreme Court in Lawson v. FMR LLC, 134 S. Ct. 1158 (2014), and for the Fourth Circuit in Foster v. Univ. of Md.-Eastern Shore, 787 F.3d 243 (4th Cir 2015).

Renner has presented papers to seminars for the National Employment Lawyers Association (NELA) where he serves on the national Executive Board and as Co-Chair of the Ethics and Sanctions Committee. He also was a presenter at the American Bar Association’s 7th Annual Labor and Employment Law Conference in 2013.

“We are so pleased to have Richard Renner as a Partner in our firm,” announced KCNF’s Managing Partner, Elaine Fitch. “Richard brings a wealth of employment law experience and applies it on behalf of our clients every day.” Renner was a partner in the Dover, Ohio, law firm of Tate & Renner until the 1995 death of his partner, Alfred Tate. He continued that law office as a solo practitioner until 2008, when he moved to Washington, D.C., to become the Legal Director of the National Whistleblowers Center.

Kalijarvi, Chuzi, Newman & Fitch, P.C., is one of the oldest law firms in Washington devoted to employment law, representing both employees and employers in federal and private sector cases. Founded in 1975 by June Kalijarvi, the firm remains a women-owned business employing nine attorneys.

“KCNF depends on the independent professional judgment of each attorney to give the best advice and representation to each client,” Renner said. “It is truly a professional dream to be a partner in a firm that treasures this pillar of legal practice while advancing the progress of employment law.”

Tuesday, November 17, 2015

Deflating The National Football League

On January 18, 2015, the New England Patriots were playing against the Indianapolis Colts in the American Football Conference (AFC) Championship Game for the opportunity to advance to the Super Bowl. During the first half, Colts linebacker D’Qwell Jackson intercepted a pass thrown by Patriots quarterback Tom Brady. This was a big play, and Jackson decided to keep the football as a souvenir. However, when the Colts’ equipment manager received the football from Jackson, he noticed certain abnormalities; after testing, the manager discovered that the ball’s air pressure was below the acceptable range required by the NFL’s rules. During halftime, the NFL tested all of the Patriots’ footballs, and determined that all 11 were below the required minimum, which gave the Patriots an unfair advantage. Thus began the “Deflategate” controversy.

On May 6, 2015, the NFL released its 139-page investigatory report. The report concluded that it was “more probable than not” that the low pressure in the footballs was caused by someone’s deliberate action. Further, the report concluded that Tom Brady was likely “generally aware” that the deflation had occurred. Within a week of the report’s release, the NFL suspended Brady for four “games” without pay. Brady appealed his suspension through his Union, the National Football League Players Association. Notably, NFL Commissioner Roger Goodell was the decision-maker on this appeal, and unsurprisingly upheld the League’s decision during the June 23, 2015 arbitration. The NFL Players Association again appealed, this time to the United District Court Southern District of New York.

On September 3, 2015, Judge Richard Berman vacated Goodell’s decision to suspend Brady. In doing so, the Court did not focus on whether “Deflategate” in fact occurred. Instead, the Court focused on whether the NFL violated Brady’s due process rights when it suspended him. Significantly, the Court found that Brady did not have adequate notice of his four-game suspension, and could not have reasonably anticipated it. In doing so, the Court also overturned Commissioner Goodell’s arbitration award against Brady.

Judge Berman’s decision is interesting for non-sports enthusiasts for two reasons. One, under the Federal Arbitration Act, judicial scrutiny of arbitration decisions is extremely limited, and awards can be overturned only on very specific grounds. Many companies require arbitration clauses in their consumer and employment contracts, and the arbitrators know that their livelihood comes from the satisfaction of these businesses. As employers win about 85% of forced arbitration cases, employees and consumer advocates protest against mandatory arbitration clauses. The New York Times recently published a series of articles on how forced arbitration protects big companies from accountability. However, at least in the sports arena, courts seem to be more willing to scrutinize arbitration awards. In addition to the Brady case, the Orioles’ also prevailed on November 4, 2015, in the Supreme Court of New York in overturning an arbitration decision that showed “evident partiality”.

Of course, there is another, likely quicker way to help bring an end to forced arbitration: contact your members of Congress and urge them to co-sponsor the Arbitration Fairness Act (AFA), H.R. 2087 and S. 1133. AFA would require that arbitration agreements with employees and consumers be made after the dispute arises – that way arbitrators will know that both parties selected them. Now, the Chamber of Commerce is lobbying Congress to prohibit the Consumer Financial Protection Bureau from regulating forced arbitration in consumer transactions.

Two, Judge Berman’s decision may have positive implications for employees who believe they have been arbitrarily punished for workplace misconduct. The NFL, as an employer, has repeatedly attempted to discipline players for misconduct in an ad-hoc fashion. The Brady case represents the fifth consecutive labor rights victory for the Players Association over the NFL on due process grounds. (The other cases involve “Bountygate”, Ray Rice, Adrian Peterson, and Greg Hardy.) However, employees should still be mindful that these cases involve powerful unions and highly visible players – in other words, not your average employer-employee relationship. In the Brady case, the Officials Locker Room attendant and the Patriots’ equipment assistant remain on indefinite suspension without pay. Nonetheless, with vigorous advocacy, perhaps the legal arguments regarding what counts as reasonable notice of a penalty and when an arbitration decision may be overturned could have a positive effect on employees in general.

For more information about this post or how you can protect your rights, please contact Nina Ren.

Thursday, November 12, 2015

The Vagaries of Employment Law

Two recent cases highlight the intricacies of employment law. Employment law is becoming an increasingly sophisticated practice. Knowing what claims to file, under what statutes, and what to allege, can–and often does–mean the difference between achieving fairness and justice for a client, or losing. But a successful outcome also depends on the facts of the case.

In Myers v. Department of Army, No. DA-0752-12-0396-I-3, 2015 MSPB 58 (November 2, 2015), Stephanie Myers, a Diagnostic Radiologic Technologist of Mammography, appealed the Army’s decision to remove her, claiming that the Army did so in retaliation for her whistleblowing. In order to succeed on this affirmative defense, Myers had to show by a preponderance of the evidence that she made a protected disclosure under 5 U.S.C. § 2302(b)(8), and that the disclosure was a contributing factor in the agency’s personnel action. Myers, 2015 MSPB 58, ¶ 22. A protected disclosure includes “any disclosure…to the Inspector General of an agency…of information which the employee…reasonably believes evidences…gross mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health and safety.” 5 U.S.C. § 2302(b)(8)(B)(ii).

In Myers’s complaint to the Inspector General, she claimed her first-line supervisor was harassing her, and her first- and second-level supervisors were involved in an inappropriate relationship. Her harassment claims consisted of a decision by her first-line supervisor and the Chief Radiologist to place her on a retraining program following her return from maternity leave, and to issue her a negative performance evaluation. The MSPB has found that allegations of harassment by a supervisor may constitute an abuse of authority. Myers, 2015 MSPB 58, ¶ 14 (citing Herman v. Department of Justice, 115 M.S.P.R. 386, ¶¶ 11-12 (2011) (explaining that an abuse of authority occurs when there is an arbitrary or capricious exercise of power by a Federal official or employee that adversely affects the rights of any person or results in personal gain or advantage to himself or preferred other persons); Murphy v. Department of Treasury, 86 M.S.P.R. 131, ¶ 6 (2001)).

The Board concluded that Myers’s harassment claims constituted an abuse of authority. The Board found that the Agency’s decision in February 2011 to require Myers to undergo retraining was not justified. The Agency had prepared a Memoranda for the Record citing to Myers’s conducting two suboptimal mammograms which resulted in two patients being recalled. Myers, 2015 MSPB 58, ¶ 15. But, as the Board noted, although the recalls occurred in December 2010, the Agency did not prepare the MFRs until April 11, 2011 and April 25, 2011–which was after Myers complained to the Chief Radiologist on April 8, 2011 about the harassment of her first-level supervisor and the inappropriate relationship between her first- and second-level supervisors, and after she informed him of her intent to file a complaint with the Inspector General. Id. at ¶ 16. The Board also found significant that Myers had received a within-grade increase on January 2, 2011, which was at odds with the Agency’s decision to place her on a retraining program on February 23, 2011. Id. at ¶ 17.

The Board also concluded that the Agency’s decision to issue Myers a negative performance evaluation on March 25, 2011 was harassment, given that she successfully challenged the negative evaluation in a grievance, which resulted in elevations of her grades in two critical elements. Id. at ¶ 18.

So far, so good for Myers. But she did not fare so well when it came to her claim that her first- and second-line supervisors were engaging in an inappropriate relationship, which she believed constituted an abuse of authority. “We have held that it is an abuse of authority for a supervisor to give preferential treatment to a subordinate with whom he or she is having an intimate relationship.” Myers, 2015 MSPB 58, ¶ 23 (citing Sirgo v. Department of Justice, 66 M.S.P.R. 261, 266-67 (1995)). In her Inspector General complaint, Myers alleged only that she felt “uncomfortable” bringing her concerns about the hostile work environment to her second-level supervisor’s attention; she did not allege that her second-level supervisor had given her first-level supervisor preferential treatment, or had otherwise exercised his authority in an arbitrary or capricious manner. Id. at ¶ 23.

If the facts of Myers’s case included her second-level supervisor giving preferential treatment to her first-level supervisor as a result of their supposed intimate relationship, and had Myers’s complaint to the Inspector General included the necessary “preferential treatment” language, she may well have succeeded at showing the Agency retaliated against her for making a protected disclosure of abuse of authority concerning the improper relationship.

At least Myers succeeded with making one of her showings that she made a protected disclosure of an abuse of authority, and the Agency retaliated against her as a result of that disclosure. The Board ordered the Agency to cancel the removal, and to retroactively restore her to her prior position. Id. at ¶ 31.

Dianah Rose-Stanley, on the other hand, was not afforded any relief. Ms. Rose-Stanley, a nurse at the Virginia Department of Corrections (VDOC), alleged that the VDOC discriminated and retaliated against her, in violation of the Virginia Human Rights Act (Virginia Code Annotated § 2.2-3900 et seq.) and Title VII of the Civil Rights Act of 1964, as amended (42 U.S.C. § 2000e et seq.) when it reassigned her from a pharmacy nurse position to a building nurse position, and when it transferred her to a facility more than an hour and fifteen minutes away from her home. Rose-Stanley v. Commonwealth of Virginia, No. 2:15CV00007, 2015 WL 6756910, at *1 (W.D. Va. Nov. 5, 2015). The Court quickly dispensed with her claims under the Virginia Human Rights Act, since the VDOC has more than 15 employees, and "the VHRA only creates a private cause of action against employers with more than five but fewer than fifteen employees," and the VHRA only "creates a private cause of action for former employees who were discharged from employment." Id. at *4 (citing Va. Code Ann. Sec. 2.2-3903(B)).

Nor did Rose-Stanley’s claim of discrimination under Title VII survive. The court found, as a matter of law, that her reassignment and transfer from one facility to another were not adverse employment actions. “‘An adverse employment action is a discriminatory act which adversely affect[s] the terms, conditions, or benefits of the plaintiff’s employment.’” Id. at *5 (citation omitted). “Unless the change has caused a significant detriment, ‘reassignment to a new position commensurate with one’s salary level does not constitute an adverse employment action even if the new job does cause some modest stress not present in the old position.’” Id. (citation omitted). Additionally, the court noted, “‘incurring small, additional commuting expenses is not the type of adverse employment action that is cognizable under Title VII.’” Id. (citation omitted). The facility to which Rose-Stanley was being transferred was over one hour and fifteen minutes away from her home, Rose-Stanley, 2015 WL 6756910, at *2. She had previously worked at that facility, but in 2002, asked that she be transferred to her current facility so she could be closer to her family. The VDOC granted her request. The court found that her additional commuting time and expenses could not be considered unreasonable, given that she had previously voluntarily worked at the far-away facility. Id. at *5.

Nor did the court find that the VDOC unlawfully retaliated against Rose-Stanley in violation of Title VII by reassigning her to a less favorable position and by transferring her to the far-away facility. Rose-Stanley claimed that the VDOC made the decision to reassign and transfer her, in retaliation for her complaining about the Director of the Medical Department and how the medical department was being managed. She voiced her complaints during three “dialogue meetings,” which were designed to allow lower-level staff members to voice concerns to management. Id. at *1. One of her concerns was that management was giving medical department employees very little notice when they were required to change shifts or duties. Id. She also alleged that prior to her transfer, she threatened to complain to the warden about her reassignment to a building nurse position. The court concluded that Rose-Stanley’s complaints did not amount to protected activity under Title VII because she never mentioned any perceived sex-based discrimination. Id. at *6. The court explained that Title VII’s anti-retaliation provisions cover an employee’s opposition to an unlawful employment practice, and participation in an investigation or proceeding regarding an unlawful employment practice. Id. (citing 42 U.S.C. § 2000e-3(a)). Because Rose-Stanley did not allege that she told her supervisor or anyone else she believed she was being subjected to discrimination on the basis of her sex, the complaints she made at the dialogue meetings did not constitute protected oppositional activity. Id.

The results may have been different had the VDOC’s actions been pled as unlawful retaliation under Virginia’s Fraud and Abuse Whistle Blower Protection Act, Virginia Code Annotated § 2.2-3009 et seq. Under that Act, no state employer may “discharge, threaten, or otherwise discriminate or retaliate against a whistle blower.” Va. Code Ann. § 2.2-3011(A). A whistle blower is an employee who witnesses or has evidence of wrongdoing or abuse, and who makes a report of wrongdoing or abuse. Va. Code Ann. § 2.2-3010. “Abuse” includes “an employer’s or employee’s conduct or omissions that result in substantial misuse, destruction, waste, or loss of funds or resources belonging to or derived from federal, state, or local government resources.” Va. Code Ann. § 2.2-3010.

If VDOC’s failure to give medical department employees little notice when they were required to change shifts or duties resulted in a substantial misuse, waste, or loss of funds or resources, Rose-Stanley’s complaint of retaliation could possibly have been brought under Virginia’s Fraud and Abuse Whistle Blower Protection Act. Sometimes, fact patterns cause employees’ cases to fall between the cracks of employment statutes designed to protect employees. This may have been the unfortunate circumstance for Ms. Rose-Stanley.

However, there are glimmers of hope in the employment law arena. In DeMasters v. Carilion Clinic, No. 13-2278 (4th Cir. Aug. 10, 2015), the Fourth Circuit joined the Sixth Circuit in concluding that the “manager rule” has no place in Title VII enforcement. Under the “manager rule,” even if a plaintiff had otherwise engaged in oppositional conduct, he or she could not qualify for protection under Title VII because he or she had a duty to report such conduct. Id. at 25-26. The Fourth Circuit explained that the “manager rule” runs counter to Title VII’s broad remedial purpose. Id. at 32.

Victories are possible, even in the context of the vagaries of employment law.

Written by Valerie A. Chastain

Wednesday, November 4, 2015

The Second Circuit “Liked” the NLRB’s Decision in the Facebook “Like” Firing Case.

Employers must tread carefully before disciplining employees for their Facebook activity. In Three D, LLC d/b/a Triple Play Sports Bar & Grille v. NLRB, ---Fed. Appx.---, 2015 WL 6161477, at *1 (2d Cir. Oct. 21, 2015) (Summary Order), the United States Court of Appeals for the Second Circuit affirmed a National Labor Relations Board (“NLRB”) decision which held that the employer violated the National Labor Relations Act (“NLRA”) when it discharged two workers for “liking” and commenting on a Facebook post regarding allegations of improper tax withholdings – i.e. terms and conditions of their employment. Id. at 3-4.

In January 2011, current and former employees of Triple Play Sports Bar & Grille (“Triple Play”) discovered that they owed more in Connecticut income taxes than they expected. Three D, LLC, 361 N.L.R.B. No. 31, at 2 (Aug. 22, 2014).[1] The employees expressed their frustrations regarding the alleged mishandling of their tax withholding to the employer, who scheduled a staff meeting for February with its payroll provider to discuss the employees’ concerns. Id. Before the scheduled meeting, a former employee, LaFrance, posted a status update to her Facebook page: “Maybe someone should do the owners of Triple Play a favor and buy it from them. They can’t even do the tax paperwork correctly!!! Now I OWE money…Wtf!!!!” Id. at 2. An exchange followed which included profanity and negative comments about the workplace. Spinella, a Triple Play employee, liked LaFrance’s status update, and Sanzone commented “I owe too. Such an asshole.” Id. The co-owner learned about the Facebook discussion from his sister (who was Facebook friends with LaFrance) and fired Spinella and Sanzone. Id. at 3. Triple play made no secret that Sanzone and Spinella were fired because of their Facebook activity. In fact, when Sanzone asked why she was being discharged, Triple Play responded that she was not loyal enough to be working for them because of her Facebook comment. Id. The Board found that Triple Play violated the NLRA by discharging them for participating in the Facebook discussion, id. at 1, and the Second Circuit affirmed.

In its decision, the Second Circuit held that the Facebook activity was protected concerted activity under Section 7 of the NLRA[2] because it was part of an ongoing discussion that began in the workplace and concerned complaints about tax liabilities, Triple Play’s tax withholding calculations, and owed back wages. Three D, 2015 WL 6161477, at *2. The court also rejected Triple Play’s contention that the Facebook activity was so disloyal or disparaging as to lose protection under the Act. Specifically, the comments did not mention Triple Play’s products or services, and there was no basis for finding that the employees’ claims regarding improper tax withholdings were maliciously false. Id.

Triple Play argued that, even if the Facebook activity was protected, it lost its protection because it contained obscenities that were made “in the presence of customers.” Id. at 2-3. According to Triple Play, NLRB v. Starbucks, 679 F.3d 70 (2d Cir. 2012) stood for the proposition that an employee’s utterance of obscenities in the presence of customers would not be protected in most or all circumstances. Starbucks involved an employee’s obscenity laced outburst in front of customers during a protest of a policy concerning union pins on work uniforms. Starbucks, 679 F.3d, at 73-74. The court found Triple Play’s reliance on Starbucks misplaced. First, unlike in Starbucks, the Board unequivocally recognized Triple Play’s “legitimate interest in preventing the disparagement of its products or services and … protecting its reputation … from defamation,” when considering whether the Facebook activity was so disloyal or defamatory as to lose protection. Compare Three D, 2015 WL 6161477, at *3, with Starbucks, 679 F.3d, at 79. Second, the comments here were not directed at customers, and accepting Triple Play’s argument that the Facebook discussion took place “in the presence of customers” could potentially chill almost all employee online speech. Three D, 2015 WL 6161477, at *3.

In addition, the court held that Triple Play’s Internet/Blogging policy was unlawful under the NLRA. Id. at *4. The relevant provision is as follows:

[W]hen internet blogging, chat room discussion, e-mail, text messages, or other forms of communication extend to employee revealing confidential and proprietary information about the Company, or engaging in inappropriate discussions about the company, management, and/or co-workers, the employee may be violating the law and is subject to disciplinary action, up to and including termination of your employment…

Three D, 361 N.L.R.B., at 8. According to the court, “employees would reasonably interpret [Triple Play’s] rule as proscribing any discussions about the terms and conditions of employment deemed inappropriate by [Triple Play].” Three D, 2015 WL 6161477, at *4.

In sum, Three D, LLC shows that simply “liking” a post regarding terms and conditions of employment is sufficient participation to constitute protected activity. The outcome may have been different if Spinella or Spanazo also “liked” or posted one of the more defamatory comments. But for now, the Second Circuit decision supports the Board’s rather broad view of employee social media rights. Importantly, employers must remember that the NLRA protects the rights of all employees, unionized or not, to engage in concerted activities for their mutual aid or protection. This includes discussions about wages, working conditions, and improper management practices. To avoid liability, employers should have their social media policies reviewed to ensure that they are not so broad as to reasonably be read to proscribe employee online discussions about the terms and conditions of their employment.

Written by Alex Kutrolli

We have also written about social media previously:

[1] Available at

[2] Section 7 of the Act guarantees that “[e]mployees shall have the right to self-organization, to form, join, or assist labor organizations … and to engage in other concerted activities for the purpose of … mutual aid or protection …” 29 U.S.C. § 157. Section 8(a) of the Act protects employees’ Section 7 rights by prohibiting an employer from “interfer[ing] with, restrain[ing], or coerc[ing] employees in the exercise of the rights guaranteed in [Section 7] …” 29 U.S.C. § 158(a)(1).

Tuesday, November 3, 2015

Can an employer’s mistake erase an employee’s rights?

Masoud Sharif was a VIP Flight Attendant for Iranian Airlines, and later a Service Director for United Airlines. United fired him last year in a dispute about his use of leave under the Family and Medical Leave Act (FMLA). Now he has appealed his case to the federal Fourth Circuit. His pending case raises the question of whether an employer’s claim of an “honest belief” can prevent a retaliation claim from going to trial. If successful, Sharif’s appeal could make employers strictly liable when they take an adverse action on account of a mistaken belief about the employee’s protected activity.

Before the 1979 revolution in Iran, Masoud Sharif was a VIP Flight Attendant on Iranian Airlines. His flights carried members of the Shah’s government and family. Sharif’s father-in-law had been a colonel in the Iranian Army. In 1981, the new government in Iran imprisoned and tortured Sharif, and he was only able to get out of prison after he divorced his wife. He fled Iran through the mountains. Like some other victims of torture, Sharif began suffering panic attacks.

Sharif came to the United States in 1982, and on April 16, 1990, United Airlines hired him as a Reservation Sales Representative in Sterling, Virginia. Sharif was promoted to Service Director, supervising reservations sales agents and handling irate customers. In 2012, he worked as a Service Director for the four United Club lounges at Dulles Airport. There were about 100 other Service Directors at Dulles.

In 2009, United granted Sharif’s request for intermittent FMLA leave, so he could take leave as necessary to manage his anxiety. United renewed his request each year. In the last approval, United allowed Sharif to take leave, “Up to 1 time per month for a duration of 1 day to 5 days.”

In 2014, Sharif took advantage of United’s employee discount program. United allowed him and his family to travel standby for only the cost of the taxes. His family traveled to South Africa on March 16 and planned to return on March 28 – allowing plenty of time to get back for his March 30 shift. At the airport, he learned that Lufthansa employees scheduled a strike to start on April 2. So many passengers were now traveling that his employee standby travel could no longer get him home on time. After failing to get a standby ticket on any flight March 28 and March 29 – even after offering to pay full fare, Sharif suffered a panic attack and notified United that he would take intermittent FMLA leave. Sharif could not leave South Africa until April 1, and he did not get to Washington, DC, until April 3, 2014.

United eventually decided to fire Sharif, based on management’s belief that he made a false claim about his panic attack in order to take leave on March 30. Sharif took an unexpected retirement to avoid the termination.

Sharif sued United claiming that the decision to terminate him violated the FMLA. The district court dismissed his case, without a trial, concluding that, “Even if United’s investigation was not optimal, no reasonable fact-finder could conclude on this record that Sharif’s supervisors’ suspicions were not honestly held.”

Sharif’s case is unusual in that there is no dispute that United fired Sharif because of his use of FMLA leave – an activity protected by law. There is no dispute that if Sharif had no medical need for the leave, then his request would not be protected. On appeal, he argues that if he actually had the medical need, then he suffered retaliation for taking the leave that is authorized by law (and had already been approved by United).

United and the district court relied on Smith v. Chrysler Corp., 155 F .3d 799, 806-07 (6th Cir. 1998), for the idea that an employer’s “honest belief” that the employee had committed misconduct can permit a court to dismiss retaliation claims at summary judgment. Sharif argues that the belief of one decision-maker does not exclude the jury’s ability to find that discrimination caused the adverse action through the influence of others. This was the Supreme Court’s conclusion in Staub v. Proctor Hospital, 562 U.S. 411 (2011). Moreover, Sharif is not required to prove that anyone at United is lying. If Sharif convinces a jury that United’s explanation is unworthy of belief, that would be sufficient. St. Mary’s Honor Center v. Hicks, 509 U.S. 502, 511 (1993).

At the summary judgment level, United is not entitled to use any evidence that the jury does not have to believe. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133 (2000). Sharif points out, “there is no other evidence to support an honest belief.” Just last year, the Supreme Court emphasized this point in the civil rights case of Tolan v. Cotton, 134 S. Ct. 1861, 1867-68 (2014)(“The witnesses on both sides come to this case with their own perceptions, recollections, and even potential biases. It is in part for that reason that genuine disputes are generally resolved by juries in our adversarial system.”)

On appeal, Sharif argues that the lower court’s decision, “would hand every defendant immunity from the employment discrimination laws by allowing it to conduct an investigation that simply stirred the air and ignored the real issues, and then incant the ‘honest belief’ talisman.”

Where a statute creates an entitlement, the employee’s rights cannot depend on the employer’s subjective beliefs. It is the law that determines whether the employee is protected, not what the employer believes about that protection. In Forman v. Small, 271 F.3d 285, 300 (D.C. Cir. 2001), the court stated, “the employer may not proffer a good faith reason for taking retaliatory action.” Otherwise, employers would be rewarded for making mistakes.

In an older labor law case, the Fourth Circuit itself held that

there is a right guaranteed by the Act – the right of an employee to reinstatement after a strike. That right is forfeited by serious strike misconduct. What we hold is that this right is not forfeited by the honest but mistaken belief of the employer that the employee has been guilty of strike misconduct

NLRB v. Industrial Cotton Mills, 208 F. 2d 87, 92 (4th Cir. 1953).

An employee’s right to use the benefits of the law, any law, will be strengthened if the Fourth Circuit can say the same thing in Sharif’s case.

Last week, the National and Metropolitan Employment Lawyers Associations (NELA and MWELA) filed an amicus brief supporting Sharif. Attorney Erik Snyder was the lead author, assisted by Stephen Chertkof, Alan Kabat and Matthew Koski.

By Richard Renner