HR and the Courts: Recent Rulings and Legislation on Salary History Inquiries, National Origin Discrimination, ERISA Class Action Litigation, Pregnancy-Related Reasonable Accommodation and More

Each month, CUPA-HR General Counsel Ira Shepard provides an overview of some labor and employment law cases and regulatory actions with implications for the higher ed workplace. Here’s the latest from Ira:

Appeals Court to Reconsider Whether Worker’s Salary History Is a Lawful Basis Upon Which to Set an Employee’s Starting Salary
The Ninth Circuit Federal Court of Appeals (covering California, Oregon, Washington, Nevada, Arizona, Idaho and Montana) will be taking another look at whether a school district’s decision to base starting salary on a worker’s past salary history is a “factor other than sex” and whether it is a violation of the Equal Pay Act, which prohibits paying men and women different salaries for the same work.

The decision to take another look at the case vacates the court’s prior decision to send the case back to the trial court to consider whether such an action is a valid business rationale and not sex discrimination. In its reconsideration, the court could decide that basing an applicant’s salary on his or her past salary is by itself perpetuation of sex discrimination in salary setting because women are traditionally paid less than men for the same work (Rizo v. Yovino (2017 BL 303715, 9th Cir., No. 16-15372 en banc review granted, 8/29/17)). The entire ninth circuit will reconsider this issue en banc rather than the traditional three-judge panel of the circuit court of appeals.

Several state and local governments have recently passed laws barring inquiries of salary history as part of the employment process.

Adverse Reaction to Employee’s Accent Grounds for Illegal National Origin Discrimination and Retaliatory Discharge Litigation
A heavily accented employee from India, who had received positive employee evaluation reviews but was mistreated by a supervisor who did not like or understand her accent and was allegedly discharged by her supervisor in retaliation for her bias complaints, has filed national origin discrimination litigation in federal court under Title VII (Kaur v. Ford Motor Co. (E.D. Mich., No. 17-13234, complaint filed, 10/3/17)).

The plaintiff, who was born in India, worked for Ford in accounting positions for more than 10 years and had received positive employee evaluations throughout her job tenure. She alleged that her supervisor would “bark” at her in a “loud and condescending manner” and suggested that “she did not understand English.”  She transferred jobs and continued to receive positive employee evaluations, but the same supervisor eventually followed her and repeated the conduct. The supervisor allegedly discharged her after she complained of national origin bias.

According to Equal Employment Opportunity Commission statistics, almost 11 percent of all discrimination charges filed with the agency are based on national origin discrimination allegations.

New Massachusetts Law Expands Pregnancy Disability Coverage Beyond Federal Protections Under Title VII and ADA – Defines All Pregnancies as Grounds for Reasonable Accommodation
The governor of Massachusetts recently signed into law a state statute designed to provide pregnant workers with protections not contained under federal Title VII law or the Americans with Disabilities Act (ADA). The ADA does not protect all pregnancies as a disability, only the ones which have a “pregnancy-related disability.” The Massachusetts state law expands that coverage and requires employers to provide reasonable accommodations to all pregnancies when requested.

Commentators state that the Massachusetts statute is the beginning of more state activism given the state of Congress, which appears to be stalled in providing expanded worker protections.

NLRB Strikes Down Overly Broad Confidentiality Policies That Prohibit Discussion of Internal Salary Information
The Court of Appeals for the Second Circuit (covering New York, Rhode Island, Vermont and Connecticut) recently affirmed a National Labor Relations Board (NLRB)’s decision to strike down an employer’s overly broad confidentiality policy as violating the organizing rights of employees. The Board and the court ordered the reinstatement (with back pay) of the worker who was fired for signing the confidentiality provisions with a note that he was “under duress” (NLRB v. Long Island Assoc. for AIDS Care (2017 BL 306541, 2nd Cir., Nos. 16-2325, 8/31/17)).

The employee in question did not object to the confidentiality provision as it related to patient care and privacy-related concerns of patients. However, the policy also prohibited all employees from discussing “non-public internal information,” which included salaries and employment contract terms. While the employee signed the confidentiality provisions when he was first hired, he balked at resigning after his first year but did so, noting that he was “under duress” with regard to the provisions he was concerned about. The employer then terminated him because of his protest.

Courts Split on Pending ERISA Class Action Litigation Against Prominent Universities
Class action Employee Retirement Income Security Act (ERISA) litigation, which has been filed individually against 16 prominent universities and alleges excessive charges for recordkeeping and violation of fiduciary responsibility for offering too many investment alternatives, has been dealt with differently by different federal courts.

Last month, a federal judge dismissed all allegations against the University of Pennsylvania. In late September, two federal judges granted partial dismissal to both Cornell University and MIT. However, the judges left portions of the allegations to stand and proceed to further litigation. In the Cornell case, the judge dismissed the allegation that the university offered too many investment options, but did not dismiss allegations that using multiple recordkeepers and offering high-fee actively managed funds and certain underperforming funds violated fiduciary rules. These matters are set for further litigation (Cunninghan v. Cornell Univ. (S.D.N.Y., No. 1:16-cv-06525- PKC, 9/27/17)).

A different federal judge kept part of the MIT lawsuit alive, adopting the reasoning of a magistrate judge’s report and recommendations, noting that a further order with legal analysis will follow (Tracey v. MIT (2017 BL 347217, D. Mass., No. 16-11620-NMG, 9/29/17)).