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Despite Lawsuit, Immigration Enforcement Set to Resume in S.C. Regardless of what happens with a recently filed lawsuit, state regulators plan to begin enforcement of employment law provisions that took effect New Year’s Day. On October 12, 2011, the ACLU and a coalition of labor unions and immigrants’ rights groups filed a lawsuit, Lowcountry Immigration Coalition, et al. v. Nikki Haley, et al., seeking to enjoin enforcement of parts of the state's 2011 immigration law, known as Senate Bill 20 (SB 20). Importantly for employers, the lawsuit does not directly challenge the law's employment provisions, including the requirement that almost all private employers use E-Verify. So the Office of Immigrant Worker Compliance of the S.C. Department of Labor, Licensing and Regulation (LLR) is still set to enforce the employment provisions of the new law, which went into effect January 1, 2012. LLR stopped enforcing the employment provisions of the state’s 2008 immigration law on May 31, 2011, four weeks before enactment of SB 20, due to questions about the validity of the prior employment provisions. Under the employment provisions of SB 20, a private S.C. employer is “imputed” (deemed to have) an employment license allowing the employer to employ workers and do business in the state. The employer violates its employment license, and could have its right to employ workers and to do business in S.C. suspended or revoked, if it either:
E-Verify is an Internet-based system operated by the federal government that checks whether a new hire’s name, Social Security number and date of birth are correct, and whether the person is authorized to work in the U.S. Generally, new employees must be verified through the system within three business days of employment. As of January 1, 2012, employers can no longer use driver’s licenses or DMV-issued I.D. cards to verify worker eligibility. The 2008 law gave employers the option of using such documentation, but SB 20 mandates use of E-Verify. LLR will enforce the employment provisions of SB 20 by either inspecting employers with its own inspectors or by contracting with a private company to conduct employer inspections. The agency is developing a statewide random audit program. It will also conduct inspections in response to written and signed complaints or when there is other good cause to believe an employer is not complying with the law. Prior to an inspection, LLR will send a letter to the employer indicating the date and time of the audit. LLR’s new audit guidelines have not been finalized, but it is expected that upon arrival the inspector will ask the employer to produce a copy of its E-Verify memorandum of understanding and the E-Verify confirmation number or printed receipt for any employee hired after January 1, 2012, or a list printed from E-Verify of employees verified since January 1, 2012. LLR inspectors should not request (nor should employers provide) copies of I-9 forms, as I-9s are inspected by the Immigration and Customs Enforcement agency (ICE) of the U.S. Department of Homeland Security. In addition to potentially losing its right to employ workers and do business in S.C., an employer that violates SB 20 will be reported by LLR to ICE and to state and local law enforcement agencies and will have its name published on the LLR website. S.C. employers can prepare for the resumption of LLR inspections by enrolling in E-Verify, training staff on use of the system and auditing immigration records. Dellinger v. Science Applications Int’l Corp.: Job Applicant Lacks Standing to Sue Prospective Employer for Retaliation under FLSA In a divided opinion, the Fourth Circuit Court of Appeals, en banc, recently determined that the Fair Labor Standards Act of 1938 (FLSA) does not restrict prospective employers from declining to hire job applicants because of a past or pending FLSA claim against a former employer. The case, Dellinger v. Science Applications Int’l Corp., 649 F.3d 226 (4th Cir. 2011), involved Natalie Dellinger, a former employee of information technology (IT) company CACI International Inc. (CACI), who in July 2009 sued CACI for alleged violations of the FLSA’s minimum wage and overtime provisions. At approximately the same time as she commenced her lawsuit against CACI, Dellinger applied for employment with Virginia-based IT company Science Applications International Corporation (Science Applications). The following month, Science Applications offered Dellinger a position contingent upon the company’s pre-screening process, which included completing various forms, a drug test and transferring her security clearance. The security clearance form required Dellinger to disclose any pending non-criminal court actions to which she was a party. Dellinger listed the FLSA lawsuit against CACI and submitted the document to Science Applications. Shortly thereafter, Science Applications withdrew its offer of employment. Dellinger then sued Science Applications in federal district court, alleging that by withdrawing the offer after learning of the lawsuit against her former employer, the company unlawfully retaliated against her for exercising her rights under the FLSA. Science Applications filed a Motion to Dismiss based on Federal Rule of Civil Procedure 12(b)(6), arguing that Dellinger failed to state a claim for which relief could be granted under the FLSA’s anti-retaliation provision. Thus, without addressing the merits of her claim, the district court considered the initial matter of whether Dellinger, as a job applicant, had standing under the FLSA to sue Science Applications, a prospective employer. Finding that the FLSA’s anti-retaliation provision does not protect prospective employees, the district court dismissed her case. Dellinger appealed the adverse decision to the Fourth Circuit Court of Appeals, contending that the FLSA protects an employee who has been the victim of retaliation by any person, including prospective employers. Citing, among others, the National Labor Relations Act (NLRA) and regulations under the Occupational Safety and Health Act (OSHA), which expressly protect job applicants, Dellinger asked the court to extend its interpretation of the FLSA to cover prospective employees. The two primary agencies which enforce U.S. laws protecting employee rights—the U.S. Department of Labor (DOL) and the Equal Employment Opportunity Commission (EEOC)—supported Dellinger’s position. Recognizing that neither the FLSA nor its regulations contain a provision which expressly provide rights to job applicants, the DOL argued that its regulations under other anti-retaliation laws which have been interpreted to include prospective employees are entitled to the court’s deference in interpreting the FLSA. In reaching its decision, the Fourth Circuit first noted that the purpose of the FLSA is to regulate the relationship between employers and employees, through minimum wage and overtime compensation rules and by prohibiting retaliation against employees who file FLSA-based complaints. The court then looked at the statutory text of the anti-retaliation provision of the FLSA, 29 U.S.C. §215(a)(3), which prohibits discrimination “against any employee because such employee has filed a complaint or instituted or caused to be instituted any proceeding under or related to this chapter.” Section 216(b) provides that “[a]ny employer who violates the provisions of section 215(a)(3) … shall be liable for such legal and equitable relief as may be appropriate to effectuate the purposes of section 215(a)(3),” and that an action to recover such damages “may be maintained against any employer … by any one or more employees” (emphasis added). The court also noted that the FLSA defines “employee” as “any individual employed by an employer,” (29 U.S.C. §203(e)(1)), and that the remedies available under 29 U.S.C. §215(a)(3) are available only from an employee’s past or current employer. The court dismissed Dellinger’s contention that the §215(a)(3) prohibition against “any person” retaliating against an employee necessarily includes Science Applications and other prospective employers, explaining that the language contained in §216(b) creates a cause of action only against an employer. Finding no employee-employer relationship between Dellinger, a job applicant, and Science Applications, a prospective employer, the court affirmed the decision of the district court. Writing for the majority, Judge Niemeyer declined broadening the scope of FLSA beyond its explicit purpose of providing minimum wage and maximum hours in the workplace and cautioned that the FLSA’s anti-retaliation provision should not be seen as a “free-standing protection against any societal retaliation.” Dellinger, at 230. Thus, the court announced that “the FLSA gives an employee the right to sue only his or her current or former employer, and … a prospective employee cannot sue a prospective employer for retaliation.” Id. at 227. In his dissent, Judge King reminded the majority about a previous en banc opinion of the court involving statutory construction, which 15 years earlier had been overruled by the U.S. Supreme Court. The case, Robinson v. Shell Oil Co., 519 U.S. 337 (1997), involved an employee of Shell Oil who, after being fired, filed an EEOC charge against the company. Specifically, he sued Shell Oil for retaliation under Title VII after a prospective employer called for a reference and received negative feedback on the former employee. While the circuit court upheld the district court’s dismissal, the Supreme Court unanimously reversed, finding the term “employees” ambiguous under Title VII and electing to interpret the anti-retaliation provision of Title VII to cover former employees. Concluding that like Title VII, the term “employee” under the FLSA is ambiguous, Judge King stated “[i]t would hardly be a stretch to interpret the FLSA to permit Ms. Dellinger’s action.” Dellinger, at 234. In addition, he warned that the majority “giv[es] its thumbs-up to [Science Application’s] conduct and pav[es] the way for other employers to adopt similar practices.” Id. at 227. Attorneys in South Carolina should be aware that while the Fourth Circuit Court of Appeals’ decision in Dellinger serves as precedent in this jurisdiction, the dissent correctly noted various statutes and case law which demonstrate a trend toward providing more expansive anti-retaliation rights for employees. Indeed, the U.S. Supreme Court’s recent decision in Kasten v. Saint-Gobain Performance Plastics Corp., 131 S.Ct. 1325 (2011), expanded the applicability of FLSA’s retaliation protections to cover oral complaints. The DOL and EEOC favor interpreting the FLSA to cover job applicants, fearing that otherwise, those who file complaints may effectively become blacklisted from future employment. In light of these factors, the matter may not be settled and could become ripe for review by the U.S. Supreme Court. In the meantime, employment practitioners should counsel employers to proceed with caution when making hiring decisions based on FLSA complaints against former employers. Simmons v. United Mortgage and Loan Investment, LLC: An Ineffective Attempt at Mooting an Action Background In the course of litigation, United sent a letter (Offer) to Plaintiffs offering to settle the case. The letter offered to (1) fully compensate each Plaintiff for overtime hours worked and back pay owed; (2) stated that damages would be calculated by comparing affidavits submitted by each Plaintiff to United’s records; (3) explained that United would also pay taxable costs and reasonable attorney’s fees; (4) asserted settlement would be confidential; (5) and required that Plaintiffs agree to waive and release all claims. After Plaintiffs moved for conditional certification, United filed a motion to dismiss, contending the court lacked jurisdiction because United had satisfied Plaintiffs’ claims and no live case or controversy existed. The district court granted United’s motion and denied Plaintiffs’ motion for conditional certification. Plaintiffs appealed the decision. On appeal, the Fourth Circuit Court of Appeals focused primarily on the Offer’s effect on the case or controversy. The Court of Appeals found the Offer did not moot the controversy for two reasons. First, the Offer did not satisfy F.R.C.P. 68—Offer of Judgment—which prevented the cause from being procedurally mooted. Second, mootness is a constitutional concept separate from F.R.C.P. 68, and under an independent analysis, the court found that Plaintiffs’ controversy survived the Offer. F.R.C.P. 68 analysis Constitutional analysis Second, United essentially left the controversy on the table. The Offer provided that the parties would calculate the dollar amount from Plaintiffs’ affidavits and its own records. This calculation was exactly the question in controversy—how many, if any, overtime hours were worked by Plaintiffs? As the court observed, even if the settlement were accepted, “the parties still had work to do in order to figure out what amounts the Plaintiffs were allegedly owed under the FLSA.” Id. at 766. One could argue that by offering to settle the exact question that gave rise to the lawsuit, the case was moot. But the court probed further, explaining that this was a fancy way to avoid litigation. The parties would not be heading to trial if they were capable of resolving this calculation on their own. Therefore, United could not moot the controversy by agreeing to settle the claim with the Plaintiffs. United responded that it would have offered a definitive amount, but was unable to because Plaintiffs refused to make a settlement demand. Relying on the above reasons, the court stated that without Plaintiffs’ knowing exactly what they were agreeing to, the Offer was “vague, and therefore, ineffective in mooting Plaintiffs’ FLSA claim.” Id. at 766. Because the heart of the case kept beating, United did not moot the controversy. Finally, the court rejected any confidentiality conditions on settlement if it is to extinguish a controversy. Focusing on how judgments affect parties, the court explained that “[i]f Plaintiffs fully litigated and prevailed on their FLSA claims in the district court, they would be entitled to an unsealed judgment.” Id. at 767. Therefore, because United’s Offer did not reflect the requirements of F.R.C.P. 68, nor the elements the court found necessary for constitutional mootness, United’s Offer did not eliminate Plaintiffs’ claims. Post-Simmons U.S. E.E.O.C. v. CTI Global Solutions: Direct Evidence that Summary Judgment is Still Alive Summary judgment, most often utilized by the defense as opposed to the plaintiff, is difficult to obtain in any case, especially discrimination cases. However, the recent decision in U.S. E.E.O.C. v. CTI Global Solutions, Inc., 2011 WL 3885813 (D. Md. Sept. 2, 2011), illustrates how summary judgment is still alive, even for plaintiffs, if sufficient direct evidence of intentional discrimination exists. Title VII “prohibits various forms of employment discrimination, including discrimination on the basis of sex.” California Fed. Sav. & Loan Ass'n v. Guerra, 479 U.S. 272, 276–77, 107 S.Ct. 683, 93 L.Ed.2d 613 (1987). When enacting the Pregnancy Discrimination Act, Congress clarified that “[t]he terms ‘because of sex’ or ‘on the basis of sex’ include ... pregnancy ... and [that] women affected by pregnancy ... shall be treated the same for all employment-related purposes ... as other persons not so affected but similar in their ability or inability to work.” 42 U.S.C. § 2000e(k). A plaintiff may establish claims for intentional discrimination under Title VII on the basis of pregnancy using two methods. First, the plaintiff may demonstrate “through direct or circumstantial evidence” that her pregnancy “motivated the employer's adverse employment decision.” Hill v. Lockheed Martin Logistics Mgmt., 354 F.3d 277, 284 (4th Cir.2004). Alternatively, a plaintiff may “proceed under a ‘pretext’ framework”—commonly referred to as the McDonnell Douglas approach—“under which the employee, after establishing a prima facie case of discrimination, demonstrates that the employer's proffered permissible reason for taking an adverse employment action is actually pretext for discrimination.” Id. at 285. Under the first method, direct evidence is “evidence of conduct or statements that both reflect directly the alleged discriminatory attitude and that bear directly on the contested employment decision.” Warch v. Ohio Cas. Ins. Co., 435 F.3d 510, 520 (4th Cir.2006) (quotation marks omitted). If believed, direct evidence “would prove the existence of a fact ... without any inference or presumptions.” O'Connor v. Consol. Coin Caterers Corp., 56 F.3d 542, 548 (4th Cir.1995) (quotation marks omitted), rev'd on other grounds by 517 U.S. 308, 116 S.Ct. 1307, 134 L.Ed.2d 433 (1996). Stray or isolated remarks may not qualify as direct evidence in employment discrimination actions, but derogatory employer remarks demonstrating “some nexus ... between the alleged discriminatory statements and any of the employment decisions made by the [employer]” will suffice. O'Connor, 56 F.3d at 549. In U.S. E.E.O.C. v. CTI Global Solutions, Inc., the EEOC brought claims on behalf of three pregnant females, Rita Tolliver, Anje Proctor and Alfre Tisdale. CTI Global Solutions, 2011 WL 3885813. All three women were removed from their positions on a project with the FBI after CTI, a government contractor and recruiting company that supplied staff for government projects, initially placed them on the project. When Tolliver inquired about the reason for her removal, Rodney Whitfield, Defendant’s Chief Financial Officer, informed her that he had removed her from the project due to her pregnancy. Following Tolliver’s removal from the project, Whitfield informed Dr. Dee Carroll, Defendant’s President and Chief Executive Officer, of the events, and Carroll concurred in his decision. When Proctor was removed, Keith Moore, Defendant’s Operations Manager, informed her that her termination resulted “because pregnant women could not work in the FBI file room.” Plaintiff relied on these comments as direct evidence of intentional discrimination, leaving the court to determine whether a sufficient nexus existed. When determining whether there is a sufficient nexus between the statement and the employment decision, courts consider the following three elements: a) the context of the statement, b) its temporal proximity to the adverse employment action, and c) the status of the person making the statement. See, e.g., Brinkley v. Harbour Recreation Club, 180 F.3d 598, 608 (4th Cir.1999) (finding an 18–month lag between a derogatory statement and the plaintiff's eventual termination insufficient to demonstrate a nexus between the statement and subsequent adverse employment action), overruled on other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90, 123 S.Ct. 2148, 156 L.Ed.2d 84 (2003). In regards to the third element, the person making the statement must hold the status of “decisionmaker” within the defendant employer's organization. See Price Waterhouse v. Hopkins, 490 U.S. 228, 277, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989) (O'Connor, J., concurring in the judgment) (“[S]tatements by nondecisionmakers, or statements by decisionmakers unrelated to the decisional process itself, [do not] suffice to satisfy the plaintiff's burden.”), superseded by statute on other grounds by 42 U.S.C. § 2000e, et seq.; Hill, 354 F.3d at 286–87. In Hill, the Fourth Circuit evaluated which agents of an employer could constitute a “decisionmaker,” reasoning that the term encompasses both agents of the defendant with formal decisionmaking authority as well as those agents who possess “principal responsibility” for the employment decision. See 354 F.3d at 289, 297 (noting that direct supervisors may qualify as decisionmakers under this analysis). After analyzing the facts and arguments, the court in CTI Global Solutions, Inc. granted Plaintiff’s Motion for Summary Judgment as to Tolliver and Proctor because a sufficient nexus existed between the comments and their removal from the project. First, the statements made by Defendant’s supervisory employees reflected Defendant’s discriminatory attitude and were made during conversations that directly addressed the reasons for Tolliver and Proctor’s removal from the project. Second, the comments were made immediately following their removal, thus demonstrating temporal proximity between the statements and the action. Lastly, the statements were made by persons likely to qualify as “decisionmakers,” as Defendant’s CFO (Whitfield) and Operations Manager (Moore) made the statements. In addition, Plaintiff preemptively asserted arguments to counter any contention by Defendant that a legitimate reason existed for Tolliver and Proctor’s removal from the project. Plaintiff provided evidence to dispute any potential claim that Tolliver and Proctor’s pregnancy prevented them from adequately performing their jobs as well as responses to any defense claim that Defendant had removed the employees because the FBI prohibited pregnant women from working on the project. The lesson learned from CTI Global Solutions, Inc. is the importance of analyzing every fact in a discrimination case because even stray comments can be direct evidence of intentional discrimination and serve as a basis for summary judgment if there is a sufficient nexus between the statements and the employment decision. |
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Employment & Labor Law Specialization Webinar Available! |
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Volunteers Needed In conjunction with the Bar’s CLE Division, the Employment & Labor Law Section is sponsoring a series of one-hour online distance learning programs to members at a discounted rate. Presenters are needed for one-hour time commitments. The CLE Division will assist with topics, taping dates and locations. We welcome any employment or labor law related topics, ranging from intermediate to advanced level. If you are interested in volunteering or have suggestions on potential topics, please contact Distance Learning Education Committee Chair Chuck Thompson at thompson@mtsolawfirm.com or (803) 254-3300. |
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Section Committees Equal Employment Opportunity Committee Immigration Law Committee Labor Management Relations Committee Membership Committee Occupational Safety & Health Committee Specialization Committee |
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Distinguished Lawyer Award
Additional information and the nomination packet will be available in February. |
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2011 NC/SC Joint Conference Video Replay NC/SC Joint Conference Additional information is forthcoming. |
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Articles are needed for future issues of the Employment & Labor Law Section newsletter. If you are interested in submitting an article, please forward your submission(s) to: Stephanie E. Lewis In addition to your proposed article, please include your name, firm and e-mail address. |
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Disclaimer This is a newsletter for the South Carolina Bar’s Employment and Labor Law Section. The South Carolina Bar and the Section council members reserve the right to refuse to publish any submission which is not consistent with their goals and standards. Articles that are published reflect only the opinions of their authors; they do not represent or reflect any positions held by the South Carolina Bar or the Section officers and council members. It is the policy of this newsletter that on all submissions of original articles, the authors assign their copyright in the work to the South Carolina Bar. Publisher may reprint, or authorize other entities to reprint, the material as deemed appropriate. The publisher has the right to authorize the reproduction, adaptation, public distribution and public display of the article as a contribution to this newsletter in electronic media, computerized retrieval systems and similar forms; such authorization includes use of the article anywhere in the world by means of public display, conversion to machine readable form and reproduction and distribution of copies. The South Carolina Bar is not required to secure the consent of the author before exercising the above named rights. In addition, the Bar has no duty or responsibility to negotiate, collect or distribute any royalties in connection therewith. |