My New Book For Employees To Be Released in Fall 2012

I'm pleased to announce that I've signed with Career Press to publish my new book, tentatively titled Stand Up For Yourself Without Getting Fired: Resolve Workplace Crises Before You Quit, Get Fired, or Sue the Bastards. It will be released this coming Fall. I'll keep you posted on how to pre-order as soon as I know. The book is geared toward helping employees, independent contractors, executives - anyone who can be fired, from the janitor to the CEO. Here's the pitch:

So, you hate your job and are ready to quit. Your boss is a flaming jerk and you’re ready to tell him off. Layoffs are imminent. You think you’re about to be fired. Maybe you think you have a lawsuit that’s your ticket out of the workplace. You’re being harassed.

You face a crucial career moment. Mistakes will cost you dearly.
  
Stand Up For Yourself Without Getting Fired provides answers to these vital questions and more:

• What Does it Mean If I Sign A Paper Saying I’m a Contractor, Not an Employee?
• Am I Exempt From Overtime?
• I’m Entitled to Breaks, Right?
• My Boss Is Creating a Hostile Environment. Can I Sue?
• I Think I’m About to Be Laid Off. How Do I Prepare?

Whether you’re a recent grad entering the workforce or an almost-retiree; newly employed or laid off after 20 years; gay or married with kids; janitor or CEO . . . buy this book if you want specific and relevant advice to help turn those bad situations around or decide to sue the bastards.

Lactation Is Not Caused By Pregnancy or Childbirth, Says Judge

Employment law is a weird field to practice in. Just because something is obvious doesn’t necessarily mean the courts are going to find that it’s so. A recent case is a prime example of the Twilight Zone that is employment law. The judge in that case ruled, “lactation is not pregnancy, childbirth, or a related medical condition.” Really?

Okay, so when I managed to nurse my two children, the milk that miraculously emerged from my body had nothing to do with having been pregnant or having given birth. Good to know. Better toss all those What to Expect When You’re Expecting books now, because the judge says they’re all wrong. The court didn’t say what they thought did cause lactation. I’m waiting with bated breath for that decision.

Backing up, I guess I’d better tell you what the case was about. A woman went on approved maternity leave. When she was ready to return, she mentioned that she wondered if she could use a back room to pump milk. Suddenly, her boss hemmed and hawed and said they’d filled her job because she’d abandoned her position. I can just see him shuddering. Breast pumping? Eww. Gross.

Long story short, she lost her case for pregnancy discrimination. The law says that discrimination because of pregnancy, childbirth, or a related medical condition is illegal. EEOC was pretty sure that lactation was related to pregnancy or childbirth (probably because of all those pesky books that said so). So they sued on her behalf.

The law, at least in the Southern District of Texas, is that, "Even if the company's claim that she was fired for abandonment is meant to hide the real reason - she wanted to pump breast-milk - lactation is not pregnancy, childbirth, or a related medical condition." Courts in the 4th Circuit, 5th Circuit, 6th Circuit, and Colorado have also declined to find Title VII/Pregnancy Discrimination Act protection for nursing mothers under various circumstances.

Fortunately, this case involved a firing that happened in 2008. Yes, the justice system is ridiculously slow (she didn’t even get to trial in all that time – this was a summary judgment). Things have changed a bit since 2008, thank goodness. Twenty-four states have laws protecting women from breastfeeding discrimination at work. Congress finally woke up in 2010 and passed the Patient Protection and Affordable Care Act which, among other things amended the Fair Labor Standards Act (FLSA) to require employers to provide reasonable break time for an employee to express breast milk for her nursing child for one year after the child's birth each time such employee has need to express milk, and a private place other than a bathroom for her to do so.This new law only applies to employees who are not exempt from overtime.

Exempt employees in 26 states (my own Florida being one) are still apparently in the Twilight Zone where they may be subject to lactation discrimination if the judges in their state think lactation isn't caused by pregnancy or childbirth.

Donna’s tips:

a. If you are on maternity leave and getting ready to return, don’t assume that you can’t be fired for breast pumping.

b. If you are salaried and your employer considers you exempt from overtime, you might not be protected under FLSA. However, many employees are misclassified. If your employer gets this wrong, you might also have overtime claims as well as claims for breastfeeding discrimination.

Nepotism Is Not Illegal

            I probably get at least one inquiry a week from someone absolutely sure that they’ve been a victim of nepotism. The boss is hiring family members or friends. A family member is promoted even though she’s incompetent or inexperienced. Or even worse, they complained about the incompetent family member and were fired.

            The injustice of it all. Surely they can sue!

            Nope. Sorry. There is zero I can do about nepotism. Zip. Nada.

            Playing favorites is not illegal. Hiring relatives is not illegal. Not if you’re in the private sector. Now, if you work for government, every state has some law about conflict of interest or hiring relatives at certain level. You’ll have to check your state and local laws if you work for government and think something illegal is going on.

            But nepotism in the private sector? It’s expected. It’s mostly legal. Here’s what might be illegal in a situation involving nepotism:

            Failure to disclose: Under Sarbanes-Oxley, management has to disclose potential conflicts of interest. So hiring of relatives, while probably legal even for publicly-held companies, can’t be hidden from shareholders. The SEC can be called in to investigate allegations of undisclosed conflicts. If you object to this type of illegal behavior, you might be a protected whistleblower.

            Discrimination: If the favored few are all of the same race, religion, national origin, or other protected category, the company could be engaging in illegal discrimination.

            Sexual harassment: If the boss favors only individuals who have engaged in sexual relations with her, and you’ve turned her down, you might have a sexual harassment claim (although sexual favoritism is mostly legal).

Donna’s tips:

a.       If your boss is the owner’s niece, be nice. I don’t care if she’s incompetent. Deal with it.

b.      Don’t write a long letter complaining about the incompetent friend or relative. It can and will get you fired.

c.       If you think the company has crossed the line into illegal discrimination, or you work for a publicly-held corporation and they are treating it like a family business, you might want to talk to an attorney about potentially blowing the whistle. Just be careful. Most Sarbanes-Oxley whistleblower cases are dismissed. They are difficult to bring and difficult to win.

d.      If you see that only friends and relatives have a future at your company, start looking. Get out on your timetable rather than waiting until you’re forced to leave on their terms.

Marathon Mediations Aren’t Good For Employees

I’m a mediator, and I’ve been one pretty much since mediation has existed. When I was trained, in the olden times, mediations were scheduled in 2 – 3 hour sessions. If they lasted longer and the parties were making progress, the mediation was reconvened another day, when the parties were fresh. I’ve found that most cases, if they’re going to settle, can settle in 2 – 3 hours. Yet I find that mediations these day seem to be expected to last 6 – 8 hours or more. So what’s happened to those reasonable-sized mediations?

I actually recently had a mediator say to me recently that her mediations frequently go until midnight. She was quite shocked when I responded that this one would not do so, and that, in fact, I had an appointment in my office at 4:00.

I started wondering. Am I just a curmudgeon?

Then I took my mother car shopping. It was while cooling our heels for hours waiting for the contract to show up that I realized why I absolutely despise the new, trendy marathon mediations. It’s because the employee is just like a car buyer. The employee is either alone or with their one lawyer. The other side is there with a lawyer, an HR rep, maybe a couple other folks. Management is the car dealer. The mediator in the marathon is the salesman, trying to get the sale done. The marathon sale is a pretty nasty sales technique, used by car dealers for years successfully, and for one reason – to get the upper hand with the consumer.

Here’s why I am going to continue to object to mediations that go beyond 3 – 4 hours:

Exhaustion: Just like the car buyer, the marathon process wears the employee down. They get careless, restless. Ready to take anything just to get out of there. They maybe have one lawyer, who is also tired. Management has an entire firm, just waiting by the phone and their computers. Possibly an insurance adjuster too. They can have multiple eyes on draft agreements to catch errors, even at midnight. Employees and their lawyers don’t have that kind of backup. There is absolutely nothing beneficial to employees that can happen after 6 or 8 or 12 hours of mediation in one day. It’s best to break it up into smaller sessions so everyone is refreshed and thinking clearly. I even wonder – is a mediator who allows a session to go that long meeting their ethical obligations to the employee? Don’t they have a duty to make sure the parties are capable of clear thinking?

Abuse: Marathon mediations have an incredible ability to abuse the employee through time wasted, trickling out one by one all the reasons the employee sucked and deserved to be fired. They become shell-shocked, even depressed. They’re already tired. The doubt creeps in.

Expense: Most mediations are borne half by the employee and half by the employer. At several hundred dollars an hour, the employer can make an already-poor former employee shell out dollars they can’t afford with no intention of ever offering anything. If there’s no offer after an hour, something is wrong in my opinion.

Here’s how the marathon mediation starts. The employee gives an opening that lasts about five minutes. The mediator asks lots of questions. Lots. Of. Questions. This, despite getting a detailed position statement ahead of time. Then the employer goes, and speaks for half an hour. More questions.

Then comes the caucus. The mediator spends an hour with the employer side, then comes back without an offer. He wants to go over some facts instead. He’d like to spend an hour or so with us, then go back to the employer. That’s when I’m certain the mediation is going to be a marathon.

Here’s how I stop it from being a marathon. I ask if there’s an offer on the table, and he looks at me funny. I say that, unless I have an offer over a specific amount in the next 30 minutes, he can call it an impasse. The mediator acts like I’m being the bad guy. But because I’m not exhausted, I’m not easily swayed. If, after an hour and a half, there’s no offer (and by an offer I don’t mean $500 or even $5000), it’s time to go. Any mediator worth their salt can get an offer from management in an hour and a half.

I place a firm time limit on the mediation. In my case, I have a pretty immovable time deadline to pick the kids up from school. But it can be anything – a meeting scheduled afterwards, dinner plans, anything that keeps you from being persuaded to lapse into the marathon. Sure, if we’re almost settled and I just need a few minutes, I can usually make arrangements to stay a bit later, but if we aren’t close, then at the deadline we need to impasse or continue to another time.

Another thing I like to do is try to start negotiating even before the mediation. I like to see how close we can get before mediation so we’re not starting from scratch. Then we can tell the mediator where we left off. If we impassed before mediation, the ball is almost always in management’s court, since I always, always make a counter to any offer I’ve received. That way, the mediator can start with management. I don’t understand why some management-side attorneys don’t want to talk before the mediation when they aren’t paying someone by the hour to talk to me. But most will gladly talk beforehand.

From now on, I’m going to tell the mediator right up front my time limit for the mediation. I’m going to tell them why. I’ll even tell them about car dealer tactics if I have to. If we can’t resolve it in that amount of time, then we can break and reconvene another day. Just like in the olden times.

So, do you agree with me, employee-side lawyers? Are marathon mediations bad for your clients? What about management-side? Do they actually benefit anyone but the lawyers and mediator? Are there any mediators out there who still limit mediations to no more than 3 – 4 hour sessions? If you think I’m wrong, I’d love to hear that too.

Work for a Church or Religious School? You May Have No Civil Rights

The Supreme Court unanimously ruled last Wednesday on the so-called "ministerial exemption" to employment discrimination laws on Wednesday, finding that churches are allowed to discriminate. The exemption is something you won't find in Title VII or other discrimination laws, but is purely a creation of the courts.
While Title VII does have a limited exemption for religious organizations, it is narrow:

This subchapter shall not apply to a religious corporation, association, educational institution, or society with respect to the employment of individuals of a particular religion to perform work connected with the carrying on by such corporation, association, educational institution, or society of its activities.

The Americans With Disabilities Act has a similar exemption:
 

Religious entities:

(1) In general

This subchapter shall not prohibit a religious corporation, association, educational institution, or society from giving preference in employment to individuals of a particular religion to perform work connected with the carrying on by such corporation, association, educational institution, or society of its activities.

(2) Religious tenets requirement

Under this subchapter, a religious organization may require that all applicants and employees conform to the religious tenets of such organization.

In other words, Congress said that religious organizations can prefer to hire members of their own religion and comply with religious rules. That's it.

The Supreme Court broadened all religious organizations' rights to discriminate, saying . . . read more here in The Huffington Post.

Don’t Make Me Gag: Confidentiality of Settlements When The Other Side Blabs

The Herman Cain sexual harassment case brought up an issue that has concerned me for years: one-sided confidentiality agreements. As you may recall before your holiday eggnog distracted you, Mr. Cain settled some sexual harassment cases before he ran for President. The agreements said the women couldn’t disclose the terms of the settlements or comment about the cases. When the press dug up the story, he publicly accused the women of making false allegations. The women were gagged, but could they defend themselves?

When I settle cases, I always ask for mutual confidentiality. That would have solved the problem in this case. If the women were prohibited from speaking about the settlement or saying negative things about Mr. Cain, he should have also been prohibited from doing the same thing to them. I ask for mutual confidentiality for a more common (and possibly South Florida only) phenomenon: HR people getting cute in references and saying, “I need to look at the agreement to see what I’m allowed to say.”

When I’ve carefully negotiated neutral references, so the employer can’t say negative things in job references, that kind of statement violates the spirit of the agreement. It also probably violates the letter, because a neutral reference clause says the employer can only give out dates of employment and job title and no other information. Still, because I’m dealing with South Floridians, I like to drive the point home. As much as I enjoy dealing with some of my opposing counsel, I prefer to avoid unnecessary conversations about stupid things like this.

Let’s say you did sign a one-sided confidentiality agreement and the other side leaks like a sieve. You also agreed not to disparage them, but they didn’t do the same. Can you defend yourself? Here are a few things that might help:

Implied covenant of good faith: Every contract has an implied covenant of good faith and fair dealing. If you are gagged and suddenly find your reputation smeared, they may have violated the implied covenant of good faith and fair dealing.

Waiver: If they’ve blabbed to the press, you certainly can argue that they waive the right to confidentiality. Once it’s out, you can argue that you have the right to defend yourself.

Defamation: If they’re saying you are a liar, that you made it up, and you have proof it’s true, then you may have a case for slander or libel. Truth is a defense to a defamation case, so if you did make it up you’ll lose. If you were telling the truth, then your reputation is damaged and you might have a claim.

Herman Cain gave me one more good reason to ask for confidentiality and non-disparagement clauses to be made mutual. Management-side lawyers should want this too, so they don’t have to deal with the specter of seeing their client doing a press conference about a settlement they worked hard to keep secret. But they’ll say, “I can’t bind everyone in the corporation.”

True, they can’t bind the janitor. However, they can bind management-level people. Anyone who reads the agreement will also read that it’s confidential. And they can caution everyone involved that it’s confidential. So don’t buy the silly argument that they can’t bind everyone.

If both sides have to keep agreements confidential, it’s less likely that there will be Cain-sized problems down the road.

Will I Be Taxed on My Employment Law Settlement?

There’s nothing certain in life but death and taxes. So what made you think you wouldn’t be taxed on your employment law settlement? I ask people this all the time when they express absolute shock that taxes were withheld from their severance check and that they’ll get hit with a tax bill in April on their emotional distress damages.

            It’s not for lack of trying. Employment lawyers and advocacy groups on both sides of the aisle have been trying for years to get the Civil Rights Tax Relief Act passed, and 2011 was no exception. It was reintroduced in the Senate on November 2, 2011 to match the House version that was introduced in October.

            Right now, the law says that, if you are injured in a car accident or have another personal injury, your settlement or judgment isn’t taxable at all. However, if you’re the victim of discrimination and suffer emotional distress, you are taxed. You also can’t average the income, so you can be taxed at a very high rate. 

            Here are the types of recovery you might receive in your employment case, and how IRS looks at it.

            Back pay: You will be taxed. Payroll taxes must be withheld. You are taxed at a “supplemental wage rate.” It’s reported on a W-2. If the Civil Rights Tax Relief Act passes, multi-year back pay could be averaged over several years for tax purposes, lessening the tax hit.

            Front pay/future lost wages: You will be taxed. Payroll taxes must be withheld. You are taxed at a “supplemental wage rate.” It’s reported on a W-2. If the Civil Rights Tax Relief Act passes, multi-year front pay or future lost wage payments could be averaged over several years for tax purposes, lessening the tax hit.

            Severance: You will be taxed. Payroll taxes must be withheld. You are taxed at a “supplemental wage rate.” It’s reported on a W-2. If the Civil Rights Tax Relief Act passes, multi-year severance payments could be averaged over several years for tax purposes, lessening the tax hit.

            Emotional distress: Even if there are physical symptoms, you will be taxed. However, you don’t have payroll taxes withheld. The danger here is you’ll get hit with a big tax bill in April and, if you don’t put a big chunk of money aside to pay, you’ll be in trouble with the IRS. The employer has to report this payment to IRS, so you will definitely have to pay. It’s reported on a 1099-MISC. If the Civil Rights Tax Relief Act passes, emotional distress damages would no longer be taxable or reported as income to IRS. They would be treated similarly to physical injuries..

            Physical injuries: If you’re actually attacked, such as in a sexual harassment case with a rape, then money received for your physical injuries is not taxable income. However, if you mischaracterize emotional distress injuries as physical injuries, you could run into trouble in an audit. It is not reported to IRS.

            Liquidated damages: You will be taxed, but they are not wages. They will be reported to IRS on form 1099-MISC.

            Attorney’s fees: Attorney’s fees paid in your settlement are income to you, but are not wages. These will be reported as income to your attorney and you. However, under an earlier iteration of the Civil Rights Tax Relief Act where Congress only passed the portion addressing attorney’s fees, the fees are an above-the-line deduction for you in most employment law cases. In other words, you have to report them, but you won’t be taxed on them. This is something you need to discuss with whoever is preparing your tax return and make sure they understand it.

            Costs: Taxable but not wages. These are reported to IRS on 1099-MISC. You will be taxed on them, although they may be deductible.

            Interest: Taxable but not wages. This is reported to IRS on 1099-INT. Interest is taxable.

            Punitive damages: This is taxable but not wages. It will be reported on 1099-MISC.

            Overtime: Overtime payments will be taxed as wages. That means payroll taxes will be withheld and it will be reported to IRS on a W-2. If the Civil Rights Tax Relief Act passes, multi-year overtime payments could be averaged over several years for tax purposes, lessening the tax hit.

            Taxes: One solution that lawyers have negotiated in some large settlements involving back pay that represents years of income is to have the employer pay part of the employee’s tax hit that results from a lump sum payment. But the payment towards taxes is considered taxable wages. It will be reported on a W-2. This would no longer be necessary if the Civil Rights Tax Relief Act passes.

            Because the Civil Rights Tax Relief Act has been attempted and failed so many times, I’m not optimistic that it will pass anytime soon. Yet both employee-side organizations and business organizations support it. Both sides agree that it will make cases easier to settle, which means that litigation costs will go down. The courts will be less clogged. It will be good for just about everyone. 

            Maybe sometime before I retire this sensible bill will pass. If you think it’s a good idea, contact your Senator and Congressional representative and ask them to support the Civil Rights Tax Relief Act.