California's Disability Law
When is Enough, Enough?

Scott Dunham is a Senior Partner in the Los Angeles office of O’Melveny & Myers LLP and Chair of its Labor and Employment Law Practice. He represents employers in all aspects of labor and employment law, and is known nationally for his expertise in these areas. Scott is also a member of the Employers Group Legal Committee. He acknowledges the invaluable assistance of his colleague, David Booher, in the preparation of this article.

While employers of all sizes deal with accommodating disabled employees all the time, the law in this area in California is a challenge for even the most sophisticated employers. Three recent California cases have elaborated on two of the most pressing questions related to disability discrimination: (1) When and to what extent are reasonable accommodations required? (2) To what extent must the employer engage in the interactive process to determine those accommodations? In other words, when is enough, enough?

The answer? Employers may never know. These inquiries are fact-intensive and these cases fall on both sides of the fence.

Raine v. City of Burbank
135 Cal. App. 4th 1215 (2d Dist. Jan. 25, 2006)
The plaintiff in Raine was employed as a police officer for the City of Burbank (the “City”) for 21 years when he suffered a torn meniscus (cartilage in the knee) while on duty. The injury caused him difficulty running, jumping, kneeling and lifting, activities that Raine conceded were essential to the functions of his position as a uniformed police officer.

As an accommodation for his injury, the City placed Raine in a temporary light-duty position as a front desk clerk at the police department while his injury healed. After Raine served in that temporary position for six years (included two years of time off for various medical procedures), Raine’s doctor diagnosed his condition as “permanent and stationary” and concluded that he would never be able to perform the essential functions of a patrol officer. In response, the City arranged a job analysis, with input from Raine and his immediate supervisor, as part of the interactive process, but determined that it had no available position for a sworn police officer with Raine’s qualifications and physical limitations. The City terminated his employment at that point and Raine sued for disability discrimination and failure to reasonably accommodate his disability.

Raine primarily contended that the City was obligated to convert the temporary light-duty desk position into a permanent position for him as a reasonable accommodation, a contention the court ultimately rejected. Normally, the front desk position given to Raine was staffed by “police technicians,” civilian employees who were paid substantially less and provided fewer benefits than sworn police officers, or by patrol officers like Raine who were injured on the job and recovering from those injuries. The City offered to keep Raine on at the level of a civilian police technician, but Raine was unequivocally not interested in that position. Instead, he contended, that he was a sworn police officer qualified to perform the functions of a front-desk position and that he had been doing so satisfactorily for six years.

The court reasoned that imposing a permanent front-desk position for a patrol officer like Raine as a reasonable accommodation would essentially force the City to create a new position that had not previously existed. The court noted the generally accepted proposition that reassignment is a reasonable accommodation and an employer is obligated to search for open positions for a disabled employee, but added that, like federal law, California law does not require an employer to create a new position for a disabled employee. Thus, in this case, California law did not require the City to create a new position by converting the front-desk position from temporary to permanent for Raine.

This case presents helpful guidance to employers regarding which temporary accommodations might be enough in these limited circumstances, but an employer should not adopt this position blindly. Several facts in this case militated in favor of the employer: there was no evidence that the City ever converted a temporary front-desk assignment to a permanent one for any other officer; the City allowed Raine to serve six years in the temporary assignment; the City made an individualized assessment of Raine’s limitations; the City engaged in the interactive process; and the City searched for open positions for which Raine was qualified. It did not hurt that Raine affirmatively refused to take the civilian police technician position as an accommodation.

Based on Raine, an employer may deny an employee’s request that a temporary assignment, i.e., a temporary accommodation, be made permanent. It is important, though, not to create precedent by converting an employee’s position from temporary to permanent in one circumstance but not another.

At the same time, employers should continue to do what they already should be doing: (1) making an individualized assessment of the employee’s need for accommodation; (2) interacting with the employee as to possible accommodations; (3) determining whether the employee can perform the essential functions of his or her former position, with or without reasonable accommodations; and (4) if not, searching for and offering any open positions the employee is qualified to fill and can perform with or without reasonable accommodations.

Williams v. Genentech, Inc.
139 Cal. App. 4th 357 (1st Dist. May 9, 2006)
Williams, a receptionist, received a poor performance review and, as a result, she began to cry uncontrollably and hyperventilate while also suffering from an exacerbation of asthma. She was put on medical leave that was extended several times for a total of seven months. During that time, the employer found it necessary to fill Williams’s position. By the time Williams could return to work, no open position was available and she was terminated.

Genentech’s generous leave policy allowed for six months of paid medical leave, and if the leave were covered by the Family and Medical Leave Act (“FMLA”), during the first 12 weeks the disabled employee’s position would be guaranteed upon her return. If the leave went beyond the 12 weeks, Genentech could not guarantee the same position, but it would allow an employee 60 days from the date of return to find an open position, of which the first 30 days would be paid. Genentech provided Williams with each of these leave provisions, including not only the extra 60 days to find a new position but also a one-month extension beyond the six months of paid leave required by the policy.

In line with Raine, the court in Williams determined that the employer had reasonably accommodated the employee’s disability, but, again, this case largely turns on its facts. Although the law is clear that “[r]easonable accommodation does not require the employer to wait indefinitely for an employee’s medical condition to be corrected,” and, correspondingly, accommodating medical leave does not have to be indefinite, the court seemed pleased with Genentech’s own generous six-month leave policy, plus extending Williams’s leave for an extra month beyond that.

The court also found that the interactive process in this case was not even triggered since Williams’s leave was a reasonable accommodation, and there was no indication that accommodation was ineffective. In this case, good facts make good law, but employers must create those good facts for themselves in order to avail themselves of this type of favorable court treatment.

This case does raise another red flag for employers, namely, that although indefinite leave is not required under California’s Fair Employment and Housing Act (“FEHA”), other laws might dictate different lengths for medical leave. For example, FMLA and the California Family Rights Act dictate 12 weeks of protected leave, while FEHA requires a “reasonable accommodation” for a disability, which could include medical leave, the length of which will largely turn on the facts of the case.

California Labor Code § 132a, on the other hand, may create an even stricter leave standard under workers’ compensation law (i.e., “the employer reasonably believes that the worker is permanently disabled from performing the job, or will be disabled for such a long time that termination is necessary in light of demonstrated business realities.” Barns v. Workers’ Comp. Appeals Bd., 216 Cal. App. 3d 524, 535 (1989)). As these various laws demonstrate, the “indefinite leave” that the Williams court rejected may be tempered by other legal requirements of which employers should be aware.

Gelfo v. Lockheed Martin Corp.
140 Cal. App. 4th 34 (2d Dist. June 2, 2006)
Perhaps the most enigmatic of recent disability law decisions, Gelfo extended an employee’s ability to sue for disability discrimination even when he or she is not actually disabled. Specifically, Gelfo is the first published decision from a California court that concludes an employee may sue for a failure to reasonably accommodate and a failure to engage in the interactive process when the employer merely “perceives” the employee as disabled.

In this case, Gelfo became injured on the job and was granted workers’ compensation benefits although he continued working. He was later laid off due to a reduction in force and put on an employee recall list, granting him priority for any later open positions. While unemployed, he was diagnosed as “permanent and stationary” with restrictions and given a 42.2% permanent disability rating under the workers’ compensation system that precluded him from heavy lifting, bending and stooping. Given these restrictions, he was unable to return to his former position, so he enrolled in a worker rehabilitation program. During this entire time, Gelfo claimed that he felt fine and was not impeded by his injury.

After completing the rehabilitation and training program to become a “plastic parts fabricator,” Lockheed offered him a position, but then discovered that it still had his medical restrictions on file. Thus, Lockheed determined that Gelfo could not perform the essential functions of that position with or without reasonable accommodations and revoked the offer.

Gelfo disagreed with Lockheed’s assessment, claiming that he felt fine and could perform the job without any accommodation, although he never provided Lockheed with any documentation to support his claims of a full recovery. He claimed to have a doctor’s release from his restrictions, but, upon the advice of his attorney, he did not provide the release to Lockheed (likely to avoid jeopardizing his $36,000 workers’ compensation award).

Lockheed then convened its Placement Review Committee (the “Committee”) to evaluate whether Gelfo could perform the new position with reasonable accommodation given his restrictions on file. The Committee: (1) forwarded the job description to the manager in charge of the position offered to Gelfo and had him break down the essential and nonessential functions of the position; (2) reviewed Gelfo’s own assessment and the assessment of his doctor imposing restrictions; (3) consulted another doctor to clarify Gelfo’s restrictions; (4) reviewed testimony in his workers’ compensation case, and (5) considered possible accommodations. The Committee determined that Gelfo’s restrictions could not be reasonably accommodated and refused to reinstate his offer.

Gelfo then asked the Committee to reconsider its decision on the basis that the Committee was misinformed about his medical restrictions, i.e., he had none, and reiterated that he had successfully completed the training without incident and was performing the same functions without accommodation or incident with another employer. The Committee reconsidered, but did not change, its decision, relying on the doctor’s reports in hand and Gelfo's doctor’s workers’ compensation testimony.

The court held that Gelfo could maintain reasonable accommodation and interactive process claims even though he was not actually disabled because he was regarded as such by Lockheed. This diverges from Ninth Circuit law, which dictates under the American with Disabilities Act (the “ADA”) that an employee cannot maintain a reasonable accommodation cause of action based only on a perceived disability. The Gelfo court instead relied on contrary law from other circuits.

Yet, again, this case really turns on the court’s visceral reaction to Lockheed’s treatment of this particular employee. Lockheed likely faced an uphill battle at the outset since the very heart of this dispute revolved around the disconnect between Lockheed and Gelfo—namely, Gelfo asserted he was not disabled but Lockheed’s only medical information dictated that he was. The intent behind the interactive process is, in fact, to reconcile these misunderstandings.

Moreover, it is not clear how Lockheed failed to engage in the interactive process in this case, given the Committee’s extensive and repeated review of Gelfo’s restrictions without any reliable, i.e., medical, information to the contrary. Alarmingly, the court even suggested that an employer cannot rely on a doctor’s assessment of an employee’s restrictions. Relying on a federal First Circuit Court opinion under the ADA, the court observed in a footnote:

“Lockheed cannot simply point to the medical reports in Gelfo’s file, and automatically absolve itself of liability under the FEHA. . . . [U]nder [the] FEHA, as under the ADA, ‘an employer cannot slavishly defer to a physician’s opinion without first pausing to assess the objective reasonableness of the physician’s conclusions.’ [Citation omitted.] This is particularly true in a case such as this. The reports on which Lockheed premised its refusal to hire were based not on an individualized assessment or testing, but on the workers’ compensation doctors’ cursory, generalized opinions about prophylactic measures aimed at avoiding potential injuries to someone with a back injury like Gelfo’s, which might occur by one performing the functions of a fabricator. [Citation omitted.]”

The court made no citations to the record to support its statement that Lockheed’s assessment was not individualized as to Gelfo or that Gelfo’s workers’ compensation doctor’s opinions were “cursory” or “generalized.” The court also gave short shrift to the fact that Gelfo had a 42.2% disability rating under the workers’ compensation system and his condition had been judged by the system as “permanent and stationary.”

Thus, employers should be very careful to take reasonable steps to interact with each employee - regardless of whether he or she is disabled or only perceived as such - in order to determine reasonable accommodations. As this case demonstrates, even frequent interactions and an in-depth assessment of both the position and the employee’s restrictions might not be enough if a disconnect persists between the employer and the employee.

So when is enough, enough?
Disability issues exist in nearly every workplace and they implicate a wide array of state and federal laws. These cases only touch on two areas that persistently plague employers: reasonable accommodations and the interactive process. Employers are wise to adopt the mantra “interact and accommodate” as much as reasonably possible; this creates the best factual scenario, which still doesn’t guarantee freedom from liability if a court’s reaction to those facts is negative. Although Raine and Williams provide helpful guidance, Gelfo makes it clear that one cannot necessarily predict when enough will be enough.

Edward J. Eybsen is a Senior Vice President for Bolton & Company, insurance brokers and employee benefits consultants. Ed’s primary focus is the design and implementation of medical, dental, vision, life and long-term disability insurance programs.

The U.S. healthcare system is reaching a breaking point. The amount we spend on healthcare and the rate of spending growth outpaces all other industrialized countries. Neither the private nor public sector can sustain this trend. Employer sponsored health insurance programs have seen double digit premium increases in recent years, resulting in increased employee contributions. Thus, an increasing number of employees and their dependents are opting out of employer sponsored plans and, in many cases, not electing alternative coverage. The result is a smaller pool of insureds and a higher proportion of high healthcare users.

If this trend continues fewer employers will be able to offer healthcare for their employees and public healthcare spending will skyrocket as qualified, low income individual’s sign on to Medicaid and the other state-sponsored medical programs.

Majority of healthcare costs incurred by a few
If we analyze healthcare spending we find that 10% of the people that incur medical expenses consume 60 – 70% of the total costs, while the top 30% consume around 90% of the costs. Improving the health of this small segment of the population makes sense, and is the focus of the term “Disease Management.”

Disease management for the chronically ill
Disease Management has been in existence for more then a decade. While its notoriety is fairly recent, varying models of service delivery have led to its effective integration into the overall healthcare delivery continuum. The Boston Consulting Group first used the phrase “disease management” in its current sense in a 1993 report. Since that time, disease management programs, techniques, and models have been designed by several innovators in the health care industry.

Disease Management is for chronically ill patients, but also helps improve outcomes and control costs. The goal is to reduce ER visits, costly hospitalizations, and invasive procedures. The most common conditions are: depression, cancer, lower back pain, cardiac disease (congestive heart failure, coronary artery disease), respiratory disease (asthma, chronic obstructive pulmonary disease), and diabetes. The top three cost-drivers in healthcare expenditures are cardiac disease, respiratory disease, and diabetes.

Identifying high medical care users
The first step in Disease Management is to determine which individuals should be put into the program. Providers of Disease Management solutions collect data in a process called Data mining. This refers to the process of turning raw claims data into meaningful inputs at the member level. This information would include:

1. The dates of service when the claim was incurred
2. The claim amount
3. The diagnosis
4. The procedure
5. The pharmacy cost and medication prescribed
6. The type of provider

The second step would be to analyze the data and develop a predictive model for future claims. Some individuals that were high users of services in the past may not be high users in the future, just as some low users will increase their need for services in the future. It is essential to develop a quality predictive model to make sure resources are used effectively.

The third step is to solicit future high users to complete a Health Risk Assessment (HRA) and enroll in the Disease Management program. The Health Risk Assessment covers medical conditions, service utilization, lifestyle issues and psychological risks.

Disease Management providers
Once future high users of medical services are identified, a Disease Management Provider can do the following:

1. Work with the Physician and patient to assure that the most cost effective, evidence-based practice guidelines are being utilized. This may be based on data obtained through medical chart reviews, state-of-the art risk stratifications, and other physician related medical decision support. The frequency of these recommendations is based on individual patient risk stratification.
2. Use self-management tools that help patients better control their illnesses. This may include education on their disease and lifestyle changes that will positively affect the treatment program that has been implemented.
3. Establish a resource for feedback to the patient after goals and outcomes are established, to modify and reinforce new behavior. This may include a Health Nurse that interacts with the patient to encourage them to stay on the program.
4. Establish a reporting system to measure the effectiveness of the program on costs and improved health of the patient.

Disease management also takes a more patient-focused approach to providing all components of care, including psychological aspects, caregiver issues, and treatment of multiple diseases. The emphasis is on both quality and overall cost, while coordinating physician care with pharmaceutical and institutional care. This improved coordination helps provide chronically ill patients with access to state-of-the-art, evidence based treatments and instructs them how to be active participants in their health care through health education.

The core of a successful Disease Management program is management buy-in to the program. Convincing senior management that investing in health (as opposed to paying for treatment) makes economic sense. Disease Management providers can provide statistical and anecdotal examples of the effectiveness of a Disease Management program.

(Editor’s Note: For information about obtaining a Disease Management provider, contact Employers Group’s liaison for Bolton & Company, kscott@employersgroup.com.)

More Internet Resources for HR Professionals

By Mark Nelson, J.D., Helpline Consultant

It seems as if there is an unlimited number of human resources-related content on the Internet, even among sites that target California companies. As we have all learned (and some the hard way), not all material on the Internet may be trusted. Even among the more legitimate compilations of online information, the sheer volume is daunting.

While an invaluable resource, even the Employers Group’s own HR Links page at http://www.employersgroup.com/knowledgecenter/hrlinks/index.shtml can seem a bit overwhelming.

Nonetheless, below are a few more links you should add to your favorites if you are not already familiar with them.

Wage and Hour
The Division of Labor Standards Enforcement publishes an indispensable on-line resource for HR professionals entitled the DLSE Enforcement Policies and Interpretations Manual, located at www.dir.ca.gov/dlse/DLSEManual/dlse_enfcmanual.pdf. While the document’s title page indicates it is a 2002 edition, don’t be mislead. It is periodically updated by the DLSE in response to major changes in the agency’s enforcement policies that have occurred since 2002.
An important note: the document reflects the DLSE’s position on various wage and hour matters; if not already settled law, some of its assertions may still be subject to judicial review by employers who disagree with the agency’s position.

Nonetheless, it is a great document to peruse if you want to know what the primary state agency vested with the responsibility of enforcing wage and hour laws thinks about your company’s practices and procedures.

Finally, because the document is available as a 300+ page .pdf file, the easiest way to find what you’re looking for is to click on the binoculars icon at the top of the page and when a window appears at the right of the screen, type in the appropriate search term.

If you don’t know what term the agency uses to address your issue, you may always review the table of contents. When you find the issue, click on the relevant chapter and subchapter headings and from the table of contents page itself, you can link directly to the page that contains the text of interest.

Family and Medical Leave
In California, you must familiarize yourself with both the Family and Medical Leave Act regulations as well as California’s Family Rights Act regulations, and the distinctions between the two sets of regulations. Because this is no easy task, secondary resources that compile that information for you are particularly helpful.

The Employers Group makes available just such a document for purchase. Nonetheless, it’s never a bad idea to have the regulations themselves on file should you find it necessary to get additional context for an issue you must resolve.

The FMLA regulations can be accessed online at the U.S. Government Printing Office’s website. From their homepage at www.gpoaccess.gov, you can link to the Code of Federal Regulations (where the FMLA regs are located; the link to them is located to the right of the picture of the White House) and browse the CFR until you find Title 29 and within Title 29, the link to the Department of Labor’s Wage and Hour Division (which spans Parts 500 to 899 of the CFR). The FMLA regs are located at Part 825. Alternatively, you can just link to http://www.access.gpo.gov/nara/cfr/waisidx_05/29cfr825_05.html.

The CFRA regs are equally as difficult to locate if you don’t know where to look. From the California Office of Administrative Law’s website, www.calregs.com, click on the link to “List of CCR Titles.” Click on the “plus sign” to the left of “Title 2. Administration,” and then select “Divison 4. Fair Employment and Housing Commission.” From there, click on the link to “Chapter 2. Discrimination in Employment.” The CFRA regs are located at “Subchapter 12. Family Care and Medical Leave.” Incidentally, the Pregnancy Disability Leave regs are right above the FMLA regs at “Subchapter 6A. Pregnancy, Childbirth or Related Medical Conditions.”

Again, unless upheld by the courts in your jurisdiction or by the U.S. Supreme Court, they may still be subject to challenge in the courts by employers that feel the agencies went beyond their powers to enact the regulations.

How Hot is "Too Hot" for your Employees

By Dagmar Muthamia, SPHR, Helpline Consultant

Over 650 people died during a heat wave centered around Chicago in 1995. Every year heat causes about 400 deaths in the U.S. according to the CDC (Centers for Disease Control and Prevention). The sad fact is that heat-related deaths are preventable—and smart employers are aware of this issue when it comes to working conditions for their employees.

Workplace considerations
There is no simple answer to question of how hot is too hot. It depends on the temperature, humidity and wind. It depends on whether the work is performed indoors or outdoors. It depends on the age and health of the person. It depends on the clothing being worn.

Those who are most at risk are children under the age of 5 and adults over the age of 65. Certain chronically ill persons and those taking medications that restrict the body’s ability to sweat are also vulnerable. As more people work past the age of 65 the number of employees likely to be affected by excessive heat will increase.

Heat illness
Heat-related illness occurs when the body’s temperature control system is overloaded. Normally the body cools itself by sweating. Under some conditions, sweating is not enough. When the body cannot cool itself by producing enough sweat, the body temperature rapidly rises. Very high body temperatures may damage the brain or other vital organs. Factors such as humidity and wind speed affect the body’s ability to cool itself during extremely hot weather. Likewise, the level of exertion and clothing are critical factors.

The most serious heat-related illness is heat stroke. Body temperature may rise to 106º F or higher within 10 to 15 minutes. Heat stroke may cause death or permanent disability. Heat exhaustion is a milder form of heat-related illness. Other heat-related illnesses are heat cramps caused by low salt level in the muscles and heat rash that is caused by excessive sweating during hot, humid weather.

Wage Order regulations
Wage Orders 1 through 13 have a section on temperature. In each it states that “the temperature in each work area shall provide reasonable comfort consistent with industry standards for the nature of the process and the work performed.”

Furthermore, employers must take all feasible means to reduce excessive heat or humidity created by the work process. If the nature of the work requires temperatures less than 60º F, then a heated room where the temperature is not less than 68º F must be maintained. A minimum temperature of 68º F must also be maintained in bathroom, resting rooms and change rooms.

The section on temperature does not appear in Wage Order 14 (agricultural occupations), Wage Order 15 (household occupations) and Wage Order 17 (miscellaneous employees). Wage Order 16 for occupations in construction, drilling, logging and mining industries is shorter. It simply states that the temperature of interior work areas must provide reasonable comfort consistent with industry standards.

Cal/OSHA regulations
Emergency regulations on heat illness prevention in outdoor places of employment were adopted in August 2005. Public hearings have been held and permanent regulations now await only review by the Office of Administrative Law.

The Division of Occupational Safety and Health (DOSH) did a study of 25 heat illness incidents that occurred from May to November 2005. Thirteen of the 25 incidents resulted in death. Most of them occurred outdoors at 100ºF during the employees’ first few days of work. The ambient temperature range was from 75 ºF to 116 ºF. Two of the individuals were wearing impermeable clothing and respirators.

The regulations apply to outdoor places of employment. They require the employer to provide one quart of water per employee per hour worked and to encourage frequent drinking of water. Employees must have access to shade at all times. Employees who are suffering from heat illness must be allowed a minimum of five minutes in the shaded area to cool off. Misting machines may be used in lieu of shade except in the agricultural industry.

Prevention
The best preventive measure for employees who work indoors is air conditioning. If you have problems with your air conditioning, you need to consider that some employees may be susceptible to heat illness. An air conditioning problem may also affect air flow and air quality. In hot weather, it is good to advise employees to drink more liquids, but not alcoholic or caffeinated beverages.

For those who work outdoors Cal/OSHA has issued a heat advisory that recommends the following:

1. Recognize when extreme heat is a potential hazard.
2. Provide an adequate supply of clean, cool water.
3. Provide shade for regular breaks and when relief from the sun is needed.
4. Acclimatize employees who will be working in very hot conditions by building up to a full days work in hot conditions over a period of 3 to 10 days.
5. Provide prompt medical attention for anyone feeling or showing the first signs and symptoms of heat illness. The signs include headache, muscle cramps, and feeling unusually fatigued, which may progress to nausea/vomiting, weakness, rapid pulse, excessive sweating or hot dry skin, seizures and fainting or loss of consciousness. Call 911 even if the employee protests.
6. Train both supervisors and employees to understand the risks and how to recognize and respond to the symptoms of heat illness.

By Jeffrey Hull, Director, Learning Services

On June 20, 2006 the Fair Employment and Housing Commission (FEHC) released the latest proposed regulations that affect the mandatory harassment prevention training for supervisory employees of employers with 50 or more employees. The commission will meet on August 29, 2006 in Riverside, CA and will, at that time, decide to adopt the regulations or consider additional comments. Employers Group will attend this meeting, and report back to you in September. Here is a synopsis of the proposed draft regulations:

Affected employers
Any employer who employs or engages 50 or more employees or contracted individuals, as long as the employees/contractor workers are employed each working day for 20 consecutive weeks, both inside and outside of California. New employers, or those who were not initially affected but begin to employ 50 or more employees, must provide training within six months of the effective date.

Affected supervisory employees
Any individual who directly supervises a California employee after July 1, 2005. New supervisors must be trained within six months of either their hire date or when they assumed supervisory duties. Those new supervisors who received training elsewhere can be excluded from this requirement if they provide evidence of such training and acknowledge receipt of their new employer’s anti-harassment policy.

Training requirements
Training must be two (2) or more hours in total duration regardless of format; however, the training does not need to be two consecutive hours. The training must include harassment, discrimination and retaliation and must cover both federal and state laws:

• On-Site, Instructor-Led Training (can be done in four 30-minute sessions)
• Online Training (e-learning) that allows trainees to contact a qualified trainer (within the company or the online provider) who is available to answer questions within two (2) business days. The online system must have “book marking” features.
• Webinars that document and demonstrate that the individual actively participated in the highly interactive training content (can be done in four 30-minute sessions).

Frequency
Training must be provided at least every two years from the date of the last harassment prevention training program.

Documentation
Employers must keep on file for at least two years information on who was trained, the date of the training, and who conducted the training including the instructor name.

Trainers
Trainers must have practical experience in harassment, discrimination and retaliation training and knowledge of California and federal laws prohibiting such acts and be able to answer questions from participants or they must have a legal education. Trainers shall be qualified on the following: (1) what is unlawful harassment, discrimination and retaliation under federal and California law; (2) how to intervene; (3) how to respond; (4) employer’s obligation to conduct an investigation; (5) what is retaliation and how to prevent it, and (6) essential components to an anti-harassment policy. The trainer must also use hypothetical examples, as well as ones that illustrate the course content.

Training content
Must include: (1) the definition of unlawful sexual harassment; (2) prevention of unlawful sexual harassment; (3) types of conduct that constitutes sexual harassment; (4) remedies available; (5) preventing sexual harassment; (6) practical examples; (7) limited-confidentiality of the complaint process; (8) resources available; (9) employer’s obligation to effective investigations; (10) what to do if accused, and (11) essential elements of an anti-harassment policy in which trainees must acknowledge receipt of such policy.

Remedies for non-compliance
Employers will receive an order in an adjudicatory proceeding and must comply within 60 days of such order.

What do you need to do as an employer?

• Conduct Training. If you have not yet conducted your harassment prevention training that was due by 12/31/2005, do so right away. This will not only safeguard you against future complaints, but will also show good-faith effort that you did try to comply with AB 1825.
• Do Not Change Policies, yet. Please remember these are DRAFT regulations. Do not change your departmental procedures on handling harassment training other than completing it on time and within six (6) months of someone assuming supervisory duties. Final regulations will likely be adopted mid-September 2006.

In summary, while the regulations do put much more burden on California employers, the purpose of the requirements are for California employers to receive significantly less harassment and discrimination complaints lodged against them.

(Editor’s Note: If you would like a copy of the draft regulations, please email jhull@employersgroup.com. Upon adoption of the final regulations, EG will provide another newsletter article on this topic and will alert you at www.employersgroup.com.

Title VII Anti-Retaliation Expanded by Supreme Court

By Jim Kuns, J.D., Senior Helpline Consultant

In resolving a dispute between Federal District Courts, the United States Supreme Court expanded the scope of the anti-retaliation provision of Title VII of the Civil Rights Act of 1964. In Burlington Northern & Santa Fe Railway Co. v. Sheila White (2006) the Court determined the provision is not confined to actions which are related to employment or happen in the workplace. The provision was found to cover an employer action, which would be materially adverse to a reasonable employee or applicant. The Court said the action of the employer must be sufficiently harmful in that it would cause a reasonable worker to avoid making or supporting a discrimination claim.

In June of 1997 Sheila White was hired by Burlington Northern & Santa Fe Railway Co. (the company) in its Tennessee Maintenance of Way department as a track laborer. She was the first woman hired for that position.

After a short time she was assigned to work primarily as a forklift operator. In September of 1997 she complained to company officials that her supervisor had repeatedly told her that women should not be working in the Maintenance of Way department. She said he made insulting and inappropriate remarks to her in front of her male co-workers. The company conducted an investigation, and ordered the supervisor to attend sexual harassment training, and suspended him for 10 days.

Company management told White about the supervisor’s discipline. She was also told that she was being removed from forklift duty and was being assigned to standard track laborer duties. She was told that her reassignment was the result of co-worker's complaints, and that a “more senior man” should have the “less arduous and cleaner job” of forklift operator.

In a complaint to the Equal Employment Opportunity Commission (EEOC) White stated the reassignment of her duties was gender-based discrimination and retaliation because of her problems with her supervisor. A couple of months later she filed another complaint with the EEOC, claiming the company put her under surveillance and was monitoring her daily activities.
Shortly after the second complaint was filed White was suspended for being insubordinate with her new supervisor. The company later, in the internal grievance procedure, determined that White had not been insubordinate, and reinstated her with back pay. She then filed another claim of retaliation with the EEOC based on her suspension.

White subsequently brought suit in federal court claiming in part that the company unlawfully retaliated against her in violation of Title VII when it changed her job responsibilities, and suspended her employment. A jury awarded her over three thousand dollars in medical expenses, and $43,500 in compensatory damages. The case was then taken to the U.S. Supreme Court.

42 U.S.C.A. § 2000e-3 (Title VII) contains the following anti-retaliation provision: “It shall be an unlawful employment practice for an employer to discriminate against any of his employees … because he has opposed any practice made an unlawful employment practice by this subchapter, or because he has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under this subchapter.”

Different federal circuit courts have decided differently as to whether or not the claimed retaliation action must be workplace or employment related and about how harmful that action must be to constitute retaliation. For example, in our Ninth Circuit the court in Ray v. Henderson (2000) said: “…the plaintiff must simply establish ‘adverse treatment that is based on a retaliatory motive and is reasonably likely to deter the charging party or others from engaging in protected activity.’ ”

The U.S. Supreme Court took the position that Sheila White had to show that a reasonable employee would have found the company’s retaliation materially adverse, and that it might well have “…dissuaded a reasonable worker from making or supporting a charge of discrimination.” The Court said: “We speak of material adversity because we believe it is important to separate significant from trivial harms. Title VII, we have said, does not set forth ‘a general civility code for the American workplace.’ … [J]udicial standards for sexual harassment must ‘filter out complaints attacking ‘the ordinary tribulations of the workplace, such as the sporadic use of abusive language, gender-related jokes, and occasional teasing’. An employee's decision to report discriminatory behavior cannot immunize that employee from those petty slights or minor annoyances that often take place at work and that all employees experience. …We refer to reactions of a reasonable employee because we believe that the provision's standard for judging harm must be objective. An objective standard is judicially administrable. It avoids the uncertainties and unfair discrepancies that can plague a judicial effort to determine a plaintiff's unusual subjective feelings. We have emphasized the need for objective standards in other Title VII contexts, and those same concerns animate our decision here.”

The Court went on to emphasize that: “A schedule change in an employee's work schedule may make little difference to many workers, but may matter enormously to a young mother with school age children. …Hence, a legal standard that speaks in general terms rather than specific prohibited acts is preferable, for an ‘act that would be immaterial in some situations is material in others.’ …By focusing on the materiality of the challenged action and the perspective of a reasonable person in the plaintiff's position, we believe this standard will screen out trivial conduct while effectively capturing those acts that are likely to dissuade employees from complaining or assisting in complaints about discrimination.” Regarding the suspension, even though reversed, the Court said: “…A reasonable employee facing the choice between retaining her job (and paycheck) and filing a discrimination complaint might well choose the former. That is to say, an indefinite suspension without pay could well act as a deterrent, even if the suspended employee eventually received back pay.”

The Court ruled in Sheila White’s favor, supporting the lower court’s decision.

Why should you Conduct Employment Screenings?

Michael Byrd is the Executive Vice President for ScreeningOne. His experience in both background investigations and physical surveillance provides a unique perspective into the investigative resources available to employers and the myriad of laws governing the employment screening industry. Michael is a nationally recognized expert and speaks to groups about fraud and background investigations. Prior to beginning his career in the investigative industry Michael was drafted and played professional baseball for the Cleveland Indians. Employers Group has partnered with ScreeningOne to provide its services to members.

As employers, when a hiring need comes up, our primary concern is often hiring someone, anyone, as quickly as possible. However, the risks associated with not conducting a thorough background investigation are significant. Many companies find that turnover, theft, and safety problems plummet when they conduct pre-employment screening.

Pre-employment screening is a “non-discrimination” action that weeds out fraudulent data and misrepresentations by potential employees. The Society of Human Resources Managers has estimated that 53% of job applications contain fraudulent information. Verifying the history of an applicant also provides companies with documentation in negligent hiring and retention suits, as well as providing proof of compliance with the web of federal and state mandates.

As of June 30, 2005, the United States Department of Justice reported that federal and state prisons or local jails had a total of 2,186,230 prisoners under their jurisdiction. Of these offenders, 47% were incarcerated for violent crimes, 23% for property offenses and 22% for drug related charges (http://www.ojp.usdoj.gov/bjs). In the absence of a background screening program, there is a strong possibility that one of these criminals could end up working for you.

The importance of background checks
As an employer, the implications of not conducting a thorough background check are staggering:

• Employee theft and dishonesty costs U.S. business over 40 billion dollars each year
• 33% of employees admit in confidential surveys to stealing a product or money from a job in the last three years
• Incidents of workplace violence, in public and private organizations, have increased more than 750 percent since 1998
• Employers lose 72% of all negligent hiring suits, with the largest negligent hiring suit to date resulted in $26.5 million dollars in punitive damages (Ward v. Trusted Health Suffolk Super. Ct. 1991)

Based on the research available, it is easy for companies to justify the investment in a background screening program. Once you have made the commitment to screen employees your work has only begun. In addition to protecting employees from violence and your organization from theft and potential liability, a company must also protect itself from conducting unlawful background checks. Penalties and negative publicity could be detrimental to an organization that does not understand and comply with the laws pertaining to background screening. For this reason, it is very important to partner with a screening company that thoroughly understands the various laws pertaining to employment screening.

Applicable law
The primary law governing the background screening industry is the Fair Credit Reporting Act (FCRA). Under the FCRA, any organization providing information for pre-employment screening is considered a “Credit Reporting Agency.” Prior to opening an account with any Credit Reporting Agency, your company will be required to sign an agreement that states you will use the information provided within compliance with the FCRA. Any company that does not require a written agreement with a statement pertaining to proper use of the credit report is in violation with federal law.

One of the most frequent mistakes made by organizations is the perception that the FCRA only pertains to credit reports. In reality, all aspects of a pre-employment background check is considered a “credit report” and falls under the FCRA. The only exception is information considered to be an “investigative credit report,” which would include information resulting from an interview that would be considered an “opinion” and not necessarily fact.

An example of an investigative credit report would be a past employment verification in which questions requesting one’s opinion, such as “was the applicant a good employee” or “did the employee get along with management,” are asked during the interview and reported. After a Credit Reporting Agency collects the information on an applicant, the employer may decide to deny the job application, reassign or terminate an employee, or deny a promotion. When this type of action is taken based on the credit report, it is called “adverse action” and falls under the guidelines of the FCRA. If you rely on a consumer report for an “adverse action,” be aware that:

1. Before you take the adverse action, you must give the individual a pre-adverse action disclosure that includes a copy of the individual's consumer report and a copy of “A Summary of Your Rights Under the Fair Credit Reporting Act” — a document prescribed by the Federal Trade Commission. The Credit Reporting Agency (CRA) that provides the consumer report will also provide your organization with the summary of consumer rights. In the pre-adverse action letter, the applicant is given a “reasonable” period of time to dispute the report. While “reasonable” has never clearly been defined, legislators have indicated five business days to be reasonable.
2. After you've taken an adverse action, you must give the individual notice — orally, in writing, or electronically — that the action has been taken in an adverse action notice. It must include:
   • The name, address, and phone number of the CRA that supplied the report;
   • A statement that the CRA that supplied the report did not make the decision to take the adverse action and cannot give specific reasons for it; and
   • A notice of the individual's right to dispute the accuracy or completeness of any information the agency furnished, and his or her right to an additional free consumer report from the agency upon request within 60 days.

There are typically two exceptions to adverse action laws:

1. Those governed by the Department of Transportation wherein adverse action may be provided verbally. However, while adverse action can be provided verbally the applicant must still be allotted a “reasonable” time to dispute the credit report.
2. Circumstances that fall within the FACT Act, situations in which an outside party conducts an investigation.

While no background checking process is foolproof, it is crucial for companies to know how to obtain the most accurate information available. There are many sources of information to consider when conducting pre-employment background checks. Often the type of background check that should be conducted will be dictated by the industry that you operate in.

Regardless of the background screening service utilized, make sure to request a thorough briefing of the options available and ensure that any company you partner with thoroughly understands the myriad of laws pertaining to employment screening. There are a multitude of records available and it is important that you take the time to discuss with your vendor the right combination of searches that will be best for your organization both economically and legally.

(Editor’s Note: For information about ScreenOne’s services, contact kscott@employersgroup.com.)

New Hire Orientation
The first step in employee training

By Kimberly Nwamanna, Helpline Consultant

As they say…first impressions are everything! What you say about your organization on a new hire’s first day will have a lasting impact on your company. New hire orientation programs should be viewed as not just a barrage of day-one data, but as a way for an organization to shape its culture and increase employee speed to ramp up and reduce turnover. Conducted properly, orientation programs can help develop an enticing culture, employee loyalty and a more productive workforce. In short, it is one of the most important “trainings” you can provide a new employee.

Keep in mind that as organizations struggle to balance time and budgets, new hire orientation programs should not be overlooked. The value of having such a program reaches further than getting your new hire acclimated to their environment. Effective orientation programs reduce turnover. New hires that have completed an effective orientation program are found to believe in their new company and understand the company’s goals.

Part of HR's job is to educate managers on the importance of making new hires feel welcomed and important. Managers and employees need to take a larger role in “closing the sale” and owning the process of assimilating the new hires because their talent will improve the team’s chance of meeting its goals. Managers should consider ways to raise the enthusiasm of and for the new hire.

The value of orientation programs
Organizations find value in knowing that all new hires receive a consistent message about the organization. Thus, when changes do occur down the line it is easier to address them when you know everyone has the same understanding about your company.

Yes, there’s always the possibility that a new hire will leave by the time of their one year anniversary. That’s when hiring replacements seems like an impending and vicious cycle. A well put-together orientation program can change these odds closer to your favor, reduce your turnover, develop an enticing culture, and help you to become an employer of choice.

What to include in a program
Whether looking at your current orientation program or developing a new one for your organization, go beyond the administrative formalities of having new hires shuffle paper and bring in necessary identification. Successful orientation programs heavily depend on clear defining elements, are well organized and containing relevant messages about the company.

Here are some tips to consider:

• Integrate new hires into the culture by communicating a warm welcome, and providing an overview of the organization’s culture and company history. That could include a phone call or visit from the CEO welcoming them to the organization.
• Review the company policies, benefits, the attendance policy, their work hours, and pay dates, but not just by handing them a “handbook” and telling them to read it.
• Use various types of learning approaches, such as actively involving new hires in a process that connects with their experience or knowledge base.
• Make information practical and relevant to a new hire’s specific position.
• Familiarize the new hire with the workplace environment. Walk them around and introduce them to their co-workers.
• Identify a point of contact to answer their future questions. Provide avenues to anticipate and answer questions a new hire might have.
• Most importantly, but often times overlooked, show them where the restroom and designated lunch areas are located.
• Speak excitedly about the meaningful work they will be doing.
• Give them information to eliminate potential barriers to help speed up productivity.
• Look beyond a one-day program but achieve a process of orienting the new hire through their entire probationary period.
• Lastly, before they even arrive, assess the training needs for the new hire and schedule training dates. This will allow the new hire to recognize his/her importance to the organization, and provide something to look forward to that will embellish his/her skills.

Continue to update the program
As your organization evolves, so should your orientation program. Don’t create an orientation program without periodically updating it with the most timely and relevant information.

It pays off for everyone
A valuable orientation program makes the new hire comfortable, introduces the work expectations, culture, coworkers and supervisors. You have one opportunity to make a lasting, positive first impression. For employers, the new hire orientation program is that opportunity. Take your time, build an effective orientation program that is germane and central to the company’s core values and mission, and you will reap the rewards of another contented new hire.

Burnt Out? Maybe it's Time for a Vacation

By Jennifer Shin, Research Marketing and Communications Coordinator

Survey results are finding that Americans work really hard, maybe too hard. According to new survey results, while the average paid vacation time in the U.S. gained two days, America’s vacation practices continues to trail behind other nations such as France and Great Britain. What's more is that one in three U.S. employees said that they don't even plan on using all of their vacation days.

According to Employers Group’s 2006 January HR Practices and Benefits Survey, 79% of midsize California companies (100-300 employees) provide an average of 10 paid vacation days per year for employees of at least one year of service compared to 12 days in 2005. On the other hand, employees in France earn an average of 39 vacation days per year and in Great Britain, about 24 vacation days. Despite the fewer paid vacation days, however, employers are finding that they still have to persuade employees to take time away from the office.

“Absolutely we have to encourage our employees to take their vacation time, said Brook Dumhart, HR Manager of Momentum Textiles in California. “If employees took the time available, we would have an entirely different situation in the U.S. But at this point, giving employees more vacation time would only increase employer liability.”

Some reasons that employees said they avoid vacations are feelings of guilt and the stress of coming back to an overflowing workload. Sixteen percent of workers report feeling guilty about missing work while on vacation and 7 percent actually fear that time off could lead to unemployment, according to a survey conducted by Expedia.com. Seventy-seven percent say they feel burned out on the job. While 84 percent of workers are planning to take a vacation this year, they might not be taking enough time to recharge.

Survey results also indicate that technology may be the culprit in why many employees feel so burnt out. Even while on vacation, employees said that they often check email or phone messages. Some workers have gone to such extremes as to lie about bad wireless connections and other technology issues to avoid work while away from the office. Men were more apt to lie about finding Internet access or cell phone signals to avoid being contacted by their employers at 13 percent, compared to 10 percent of women.

Companies are consequently finding that more vacation days do not mean more relaxation. According to Mary Formosa, Office Manager of California Corporate Benefits, while employees receive an average of seven paid vacation days, employees make sure their days off are completely away from the office. Formosa said that while “clients always come first,” employees are cross-trained so that there’s someone in the office to help out. As a result, employees rarely have to check in with the office or work during days off.

“We’re a tight-knit family. Pretty much when you take a vacation, they’re people here to cover for you,” Formosa said.

According to CareerBuilder.com there are some other tips employees and employers can do to ensure that employees don’t suffer from burn out and enjoy their vacation time:

• Use your common sense. If a big project and a great vacation are planned for the same week, something will most likely have to change. Schedule the dates accordingly, in order to ensure that you enjoy your time off.
• Employers should also encourage vacation time and help employees out in notifying them of the busy seasons by reviewing previous sales and current situation.
• Cross-training a co-worker to share tasks saves on-vacation headaches and creates a network. Next time a co-worker needs to take a vacation, you can return the favor.
• Provide colleagues and clients with an alternative contact via voicemail or an automated email response. People then know you're out and where they can get immediate assistance, and you don't experience inbox overload when you return.
• Set limits. Employees and employers should try to respect a colleague’s vacation time. Checking in a couple of times during a week off or calling a vacationing employee during an emergency is understandable. However, an everyday phone conference is not. Boundaries should be established to avoid stress.

Legal liabilities aside, employers should encourage employees to enjoy their vacation time for the sole purpose of maintaining a happier and healthier workforce. Whether employees receive three days or three weeks of paid vacation time, employers are finding that employees who are slaves to their cell phones and computers during their off-time continue to feel overworked and stressed. Consequently, employers should focus on the quality, not quantity, of vacation time given to employees.

For more information or questions about Research Services’ surveys, please contact us at surveys@employersgroup.com or by phone at 213.765.3935.