Presented by the Employment Law Practice Group

Legal Updates for Employment Law

February 23, 2016

EEOC’s Proposed Guidance Expands the Scope of Retaliation

By Lee C. Durivage

On January 21, 2016, the EEOC issued its Proposed Enforcement Guidance on Retaliation and Related Issues, the first guidance on retaliation issued by the EEOC since 1998. The EEOC determined that the updated guidance was needed because 43 percent of charges filed with the EEOC assert claims of retaliation. While the guidance is currently open for commentary, the 76-page proposal should have employers paying attention to the expanded interpretations of the law that EEOC investigators will use in their investigations going forward.

For instance, the guidance focuses on the fact that anyone who “participate[s]…in any manner” in an investigation (formal or informal) where the anti-discrimination laws may apply will be deemed to have engaged in “protected activity.” In fact, the guidance expressly rejects the “manager rule,” where managers who are required to investigate discrimination claims cannot be deemed to have engaged in “protected activity.” Other examples of protected activity cited by the EEOC include:

Providing any information in an employer’s internal EEO investigation, even if it helps the employer;
Refusing to obey an order believed to be discriminatory;
Advising an employer on EEO compliance;
Making complaints against a previous employer; and
Raising discrimination claims, even if the employee is not protected by the statute (i.e., an employee who is younger than 40 years old making a complaint of age discrimination).

Significantly, the EEOC’s guidance not only expands the type of activities that will be deemed “protected,” but it also expands the scope of action that could be deemed “adverse.” Specifically, in addition to the traditional adverse actions (termination, demotion, denial of promotion), the EEOC provides the following examples of actions that “might well deter reasonable individuals from engaging in protected activity:”

Warnings, reprimands and negative evaluations;
Transfers to less desirable work or location;
Disparaging the person;
Threatening reassignment;
Scrutinizing work or attendance more closely than others; and
Giving inaccurately lowered performance appraisals, even if not unfavorable

Finally, while the EEOC acknowledges that retaliation must be the “but for” cause between the “protected activity” and the “adverse action,” it noted that a plaintiff may establish a causal connection by demonstrating “a ‘convincing mosaic’ of circumstantial evidence that would support the inference of retaliatory animus.” In particular, the EEOC states that this “mosaic” may include evidence of: suspicious timing; verbal or written statements; comparative evidence regarding similarly situated employees; falsity of the employer’s proffered reason for the action; or “any other ‘bits and pieces’ from which an inference of retaliatory intent might be drawn.”

Although this guidance is in “draft form,” employers ought to expect a significant increase in retaliation claims made to the EEOC. As a result, employers should review their employment policies and make sure their handbooks are updated and that the discipline of employees is handled appropriately and consistently throughout the company. Otherwise, the EEOC may look at these failures as a type of “bits and pieces” in an effort to find in favor of plaintiffs.

Wanted: Your Company's Workforce Pay Data — EEOC Proposes Adding Compensation Data to Annual EEO-1 Report

By David J. Oberly

On January 29, 2016, the United States Equal Employment Opportunity Commission (EEOC) released a proposed revision to the Employer Information Report (EEO-1) that would add employee pay data as an additional reporting requirement beginning in September 2017. The proposal is highly controversial, as it will require private employers for the first time to publicly announce pay data.

The EEO-1 already requires private sector employees with over 100 employees to provide employment data that is intended to serve as a demographic snapshot of an employer's workforce. The pay data proposal would add aggregate data on pay ranges and hours worked to the EEO-1 reporting requirements. Under the proposal, employers would be required to report by race, ethnicity, and gender their workforce's total hours worked and W-2 earnings. The EEOC would then utilize this pay data to assess complaints of discrimination, focus agency investigations and identify existing pay disparities that may warrant further examination. In addition, the EEOC proposal also seeks to require that all EEO-1 reports be filed electronically starting in 2017.

Employers are well within reason to not be pleased with the EEOC's proposed regulations, which are estimated to apply to more than 63 million employees nationwide. For starters, the proposal would substantially increase the data reporting burdens on employers, who would be required to implement new data management systems not only to collect and document data concerning compensation levels and hours worked, but also to extract that data and report it to the Commission in order to comply with the new electronic reporting requirements. More importantly, these new reporting requirements will almost inevitably lead to more charges of pay discrimination by employees, who will be able to utilize this abstract, summary data to claim that they are being compensated below industry standards.

As proposed, the data will not be presented in any context and will not take into account any key legally-accepted business considerations or other factors to explain the compensation disparities, such as education, experience, seniority, degree of responsibility and performance. As a result, it is likely that employers will see an uptick in the amount of claims filed by employees alleging discrimination on the basis of pay. Moreover, the data collected by the new pay regulations will also strengthen the EEOC's ability to affirmatively file actions without identifying individual plaintiffs.

While the new proposed pay data reporting regulations have yet to be approved or implemented, employers should begin contemplating what impact the new requirements might have on their existing business operations should the proposal go into effect. At this time, employers should begin looking at measures that will need to be implemented in order to ensure the ability to collect, document and report pay data according to the new requirements (which includes electronic submission of EEO-1 reports). In addition, employers should assess their current pay practices in order to evaluate whether any potentially troublesome compensation disparities exist.

Employers are well advised to conduct internal audits of their pay practices this year in order to identify any pay gaps that might trigger a response from the EEOC in connection with the new pay reporting regulations. Ideally, these audits should be conducted with the assistance of legal counsel, which will enable the employer to shield any arguably negative analyses or findings through applicable legal privileges. Moreover, done properly, these audits will allow employers to cure any potentially problematic pay practices prior to September 2017 when the new requirements could go into effect. At a minimum, employers should review their own pay data to ensure that they are fully capable of providing reasoned and non-discriminatory justifications for any and all tangible pay inequalities among similarly-situated employees in their workforce.

Defining Employee Opposition Under the Florida Whistleblower Act

By David R. Bear

The Florida Whistleblower Act (FWA) contains what is commonly known as an opposition clause. This section of the Act provides protection for an employee who objects or refuses to participate in an employer activity, policy or practice that is in violation of a law, rule or regulation. Over the last three years, there have been significant developments in determining which employees are covered under the opposition clause.

Prior to 2013, the opposition clause was repeatedly interpreted by federal courts to require that the employer commit an actual violation of a law, rule or regulation in order to provide whistleblower protection to an employee who objected or refused to participate. However, in 2013, Florida’s Third District Court of Appeals became the first Florida appellate court to address the opposition clause, and in doing so, they interpreted it to cover employees who simply had a good faith and objectively reasonable belief that the employer was committing a violation. Avery v. Wallace Lincoln-Mercury, LLC, 118 So.3d 904 (Fla. 4th DCA 2013). This eliminated the requirement that an employer had to have actually violated a law, rule or regulation in order for the employee to become a protected whistleblower. Under this new standard, an employee could express his objection to an employer’s practice that was, in fact, completely legal, but the employee simply thought, or claimed to have thought, it was illegal.

Things changed again in 2015, however, when Florida’s Second District Court of Appeals disagreed with the holding of the Third District in Avery. The Second District interpreted the plain language of the opposition clause in the FWA to require the employer to have actually committed a violation of a law, rule or regulation in order for an employee to gain whistleblower status by objecting or refusing to participate. Kearns v. Farmer Acquisition Co., 157 So.3d 458 (Fla. 2d DCA 2015).

While good news for the defense bar, this endorsement comes with a caution: certain courts may consider that the Second District’s holding is non-binding dicta given the contrary holding in Avery. Nonetheless, the Second District’s reasoning in Kearns is new authority to offer and argue in cases filed pursuant to the FWA and one that affords a more appropriate reading and interpretation of the FWA.

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