DOL Delays “Final Rule” for ERISA Disability Benefits

On November 29, 2017, The Department of Labor delayed through April 1, 2018, the applicability of a Final Rule amending the claims procedure requirements applicable to ERISA-covered employee benefit plans that provide disability benefits. The purpose of the Final Rule was to add procedural protections and safeguards similar to those applicable to group health plans under the Affordable Care Act. In a nutshell, the Rule would require that plans providing disability benefits ensure all claims are adjudicated in a manner designed to ensure independence and impartiality, certain disclosure requirements, the right to review and respond to new information before a final decision, and that if a plan fails to adhere to all the claims procedure rules, the claimant would be deemed to have exhausted administrative remedies and may pursue court action (unless a limited exception applies). Finally, the rules amended the definition of adverse benefit determination to include a rescission of disability coverage having a retroactive effect, unless it was due to failure to pay timely premiums. Continue Reading

Reimbursement of Employment Tribunal fees: the latest position

The Ministry of Justice and Her Majesty’s Courts and Tribunals Service have now rolled out the details of the scheme to refund claimants and respondents who paid a fee at an Employment Tribunal or the Employment Appeal Tribunal between 29 July 2013 and 26 July 2017.   This is of course the necessary result of the inevitable finding that those fees were an obstruction to access to justice for many claimants.

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Illinois Employers Face A Recent Rash of Class Action Lawsuits Filed Under State Biometric Information Privacy Law

Illinois enacted its Biometric Information Privacy Act (“BIPA”) in 2008 to regulate, among other things, employer collection and use of employee biometric information.  Biometrics is defined as the measurement and analysis of physical and behavioral characteristics.  This analysis produces biometric identifiers that include things like fingerprints, iris or face scans, and voiceprints, all of which can be used in a variety of ways, including for security, timekeeping, and employer wellness programs.  Continue Reading

When Mummy doesn’t necessarily know best – mediation and maternity rights claims

At the end of my post on Maternity Action’s report on unfair redundancies, I mentioned a number of the reasons why many recent mothers do not raise complaints about their perceived treatment at the hands of their employer. These included a fear of creating bad feeling with their employer or colleagues, a lack of information, feeling guilty, not wanting to damage their prospects, the process being rather daunting, and not feeling that they have a good enough case. One reader of this blog has posed this follow-up question – “Could those issues be resolved by some approach less confrontational than a formal grievance or claim, specifically mediation?”

The answer is probably yes and no. The obvious problem is that you can’t have an informal discussion about your concerns as a returning or redundant new mother without raising those concerns in some form or other. If the anticipated flak from that is enough to put you off, then clearly those concerns are not going to be addressed by your employer. Similarly, not believing that you have a good case to complain is obviously among the very best reasons for not doing so. No employer is likely to engage in any process (however warm and non-confrontational) which is designed to allow or encourage employees to believe that they have better reason to sue than they thought.

However, it may well be the case that if the employee could see that any complaint or concern could potentially be addressed with a minimum of confrontation and formal process, she may be more likely to raise it in the first place. As to why on earth the employer might want to do that, the response is simply because if that led to an early correction of any unfounded fear or misunderstanding by either party, a more formal (and lengthy and costly and distracting) dispute or stand-off may be avoided. Remember that almost all the case studies in the Maternity Action report talked less about what the employer actually did than what the employee “felt” or “feared” or “perceived”. Any process which could quickly clarify or reassure the employee as to what was actually happening and why could potentially head off any sense of alienation and the resulting grievances, claims or staff losses, to the immediate benefit of both parties.

At a more granular level, the without prejudice “bubble” of a mediation may also allow the parties greater freedom to explore helpful variations in the employee’s working arrangements which she may not want to suggest in case it weakens her statutory rights or negotiating position and the employer may be nervous raising in an open context for fear of inadvertent discrimination. One might say that those are things which could be discussed openly in a suitably trusting and mature environment, but that is just not always possible.   Offering an expressly “safe space” for that purpose may therefore be useful. [For the employer we must obviously enter the caveat here that that “bubble” does not offer protection for any “manifest impropriety”. If you say or propose anything in such a mediation which is blatantly discriminatory, it can still be used against you. Normally we would say that it would be difficult for a failed mediation to make matters worse, but unless handled carefully, these circumstances can be the exception to that rule.]

It would be hoped that a mediation (or less formally, perhaps just a facilitated discussion) between returning employee and line manager would produce a solution acceptable to both. Even if it does not, however, it equips both parties with a better understanding of the other’s position. In that way it reduces the scope for the reciprocal suspicion of motives and intentions which sometimes haunts a return to work. Even if offering a form of mediation for maternity-related disputes led initially to more enquiries or challenges being made, it might also help dispel more of those feelings or perceptions or fears referred to by Maternity Action. That in turn could lead to fewer of the far more costly and time-consuming formal complaints or legal claims.

So in answer to the opening question, yes, you could certainly use mediation to try to side-step the sort of issues mentioned by Maternity Action, but still only if the returning mother is willing or able to raise them in the first place.

Working from home not enough to support independent contractor relationship

The scrutiny by the Australian Courts of independent contractor relationships continues with the recent case of Putland -v- Royans Wagga Pty Limited. The Federal Court found in August this year that a husband and wife who provided home-based clerical work exclusively to one company were its employees rather than independent contractors.

Royans Wagga’s business involved the repair of trucks. It engaged the services of Mr and Mrs Putland to obtain, collate and pass on information regarding accidents causing damage to trucks. The Putlands each had their own ABNs (Australian Business Numbers), issued tax invoices, to Royans Wagga, split their income and did not use Royans Wagga uniforms or branding. In addition, the work they did was largely done from their home.

Despite these multiple factors favouring an independent contractor relationship, the Federal Court still found the Putlands to be employees. It considered in particular the extent of the control which Royans Wagga exercised over the Putlands. That plus the exclusive service they provided to it left the Court with no doubt as to the true nature of the relationship. It considered that the Putlands were “subordinate to the Managing Director’s wishes, even if he did not always get his way”. This included Royans Wagga giving its approval for Mr Putland to begin providing his services also (previously only Mrs P was engaged for this purpose) as well as determining increases in their fees. Royans Wagga also often issued written directions to the Putlands concerning the standards of work it expected. If the Putlands had been genuine independent contractors, they would not have needed Royans Wagga’s approval of how they staffed the work they did for it. Similarly, it would have been the Putlands who dictated their fee levels and they would have had substantial autonomy over how they provided their services.

In relation to the work being conducted primarily at their home, it was noted that advances in modern technology mean that working from home is not inherently inconsistent with an employment relationship. These days, the work of an administrative or clerical nature that can be done at home differs little from what could once only have been done in the workplace.

Lessons for Employers

  • This case serves as a reminder to businesses which use independent contractors that even if the contractor has their own ABN, issues their own tax invoices and works remotely, this will not be determinative of a contractor relationship. The Courts will assess a wide range of factors including whether the principal has (by contract or practice) the right to control the contractor, whether the contractor is providing their services only to the principal and what is said on the point in any written contract (but see 3 below). They may also look at how far the contractor advertises their services to the public in general, what level of specialist technical expertise the contractor brings, and whether the role is of a temporary advisory or permanent operational (i.e. employee-type) nature.
  • Other relevant factors could include the presence or absence of the normal indicators of an independent business operation, such as the contractor having their own insurance, logo/branding, website or marketing material, any contract of employment he/she has with a limited company or partnership; the ability to offer a wider range of services than provided to that “customer”; whether the individual’s commitment is full-time (so making it de facto impossible for him to work with anyone else anyway); and who supplied the basic form of any written contract entered into. As a rule the employer would provide the employment contract, whereas the contractor would provide the starting point for a business services agreement, even if both were then subject to some level of negotiation.
  • Although the written terms of any contract with a “contractor” are relevant, they are not determinative – if in practice the individual is managed like an employee and does the work of an employee over the hours of an employee, he could well be found to be an employee, quite regardless of what the contract says.

When a little knowledge is a dangerous thing – reliance on immigration law to justify dismissal

Every employer knows that UK law relating to illegal workers is big and fierce and that you take liberties with it at your peril. However, here is what can happen when you take it too seriously.

In Abellio London Limited – v – Baker, the EAT has this month taken a look at whether an employer’s genuine belief that immigration law says something it actually doesn’t is enough to justify a fair dismissal. Since the law here is often unclear, penalties for non-compliance are material and it can be hard to obtain definitive guidance from the authorities, the case is potentially very significant.

Mr Baker is a Jamaican national who has lived in the UK since childhood. It was not disputed at any time that he had the right to live and work in the UK, but he was dismissed by Abellio when he failed to produce the documents referred to in Section 15 of the Immigration Asylum and Nationality Act 2006 by way of proving it.

Abellio read Section 15 as a meaning that unless the employee could produce the relevant documentation, it could not lawfully employ him. It wrote Mr Baker a series of somewhat contradictory letters explaining that although it fully accepted that he had the right to work in the UK, it still could not continue to employ him until he proved it, and then dismissed him.

Normally compliance with immigration law would be a good reason to dismiss – if continued employment would be unlawful, the employer would surely have little choice. But do be careful that you have the law right, which Abellio didn’t. Section 15 does not make the holding of proof of right to work a legal requirement. It merely provides an employer with a defence if that employee is later found to be employed illegally. Moreover, by Section 25 IANA, Section 15 only applies to employees who are “subject to immigration control”, which Baker was not. As a result, Abellio could not use the legal position as justification for his dismissal.

But even if it were wrong about what the law actually required, could Abellio’s genuine belief that it had to act as it did nonetheless amount to “some other substantial reason” and be the basis of a fair dismissal that way instead? In other words, is it ok to be wrong about the impact of immigration law so long as you think you are right?

The EAT thought that this could potentially be ok – after all, if you dismiss someone for misconduct, you need only a genuine and reasonable belief in that employee’s guilt, not absolute proof. There was no question but that Abellio genuinely believed production of the Section 15 documents to be a pre-condition of lawful employment, but it was less clear that that belief was reasonable. That seems harsh given that it had received supportive advice from both the Home Office and the UK Border Agency, but it was unclear whether it had asked the right questions of those bodies. In particular the EAT did not know whether Abellio had told them that Baker was not subject to immigration control (in which case, one would hope, a different answer would have been given). But that in turn assumes that Abellio knew Baker was not subject to such controls. Since he is not a UK or EU national, that would have been a pretty brave call for most employers.

Lesson for Employers

Because the EAT had insufficient evidence on the point, the matter was sent back to the Employment Tribunal for another go. If it decides that Abellio’s belief that it needed the Section 15 documentation as a condition of Baker’s continued employment was reasonable, the dismissal should be fair even though the company was wrong.

However, if the ET concludes that employers are under a greater or more rigorous duty of enquiry as to the “ins” and “outs” of the UK’s complex immigration regime, we hope at least that it will express a view as to what sort of enquiries need to be made. It would be an unsatisfactory state of affairs for employers trying their best to stay on the safe side of the immigration rules then to be caught by the unfair dismissal regime instead.

Thriving at Work – Part 3

Following our previous blogs on the Stephenson/Farmer report, this post looks at some more of the hard facts from the report associated with mental health conditions in the workplace and their causes.

First of all, it should be noted that “mental health at work” encompasses not only problems caused by or at work, despite what it says on the tin, but also those issues brought to work from other aspects of the employee’s life. This widely varying set of causes can make mental health issues very complex to deal with.

The premise of the report is that “good work is good for mental health”. Good work includes having a degree of autonomy, fair pay, some form of work-life balance, opportunities for progression and an absence of bullying and harassment. The approach taken by the UK Government is to tackle mental health, whatever its source, based on three different groups of people: i) those who are thriving; ii) those who are struggling; and iii) those who are ill and possibly off work. The idea is that this will address the fact that although any employee can have serious mental health issues from time to time, with the right support, he can still thrive at work.

The report points out that for many, mental health is not the only problem. A quite remarkable statistic from the ONS 2016/17 survey shows that 71% of long-term mental health conditions are present alongside other physical long-term health conditions and equally those with long-term physical health conditions are two or three times more likely to experience poor mental health. Therefore, it is important that these two issues are combined and considered together.

The statistics are not all doom and gloom, however. The good news is that 1.5 million people in the UK with a diagnosed long-term mental health condition are in employment, a level which has increased from previous years. Clearly employers are gradually overcoming the stigma associated with mental health issues. However, those with mental health problems are still far more likely to lose their jobs every year (6% of the employed population and around 300,000 a year) at around double the rate of those without any such condition (3%) and at a much higher rate than those with a physical health condition only (4%). This may be because of inadequate or inappropriate adjustments made by the employer; because the employee either is not (or thinks that he is not) being listened to by his employer; or because the stigma still associated with mental health has meant that the employee has felt unable to raise the issue with his employer in the first place.

The costs of mental health issues in the workplace, as we have seen in our “Thriving in work – Part 2” blog, can be astronomical (as much as £1,205-£1,560 per year per employee). In contrast, the return on investment in this area can be quite significant (on average, £4.20 for every £1 spent). The report therefore suggests that if employers and Government could work together to reduce the turnover of those with mental health problems to the same level as those with physical health conditions, this would prevent around 100,000 people leaving employment each year.

So what is the real root of the mental health turnover problem? The most common perceived “sins” by employers as suggested by the report are as follows:

  1. Missed opportunities to intervene early – only 11% of employees asked had discussed a mental health problem with their line manager and 50% said they would not want to discuss it.
  2. Employers not being transparent about their attitude to mental health – only 11% of the top 100 companies have disclosed their mental health initiatives.
  3. A lack of awareness on the part of employers of how to promote good mental health and of where to find external support – only 4 in 10 organisations have policies or systems in place to support their employees.
  4. Employers not regularly monitoring and assessing mental health – 8 in 10 employers report no cases of employees disclosing a mental health condition.
  5. Employers want to do the right thing but line managers lack training, skills or confidence – only 24% of managers have received training on mental health at work.

Given the increasing prevalence of mental health issues and the Government’s current focus on it, these statistics highlight how important it is for companies to do their bit to help tackle the problem. Now would be a good time to consider any mental health initiatives that you could implement within your organisation. It is clear that promoting awareness within the company, including training your managers to deal head-on with mental health issues and the stigma that surrounds them, can make a significant difference to the workplace. That is, not only to the culture, the productivity of the workforce and the costs associated with sickness due to mental health issues, but also to the employees who have mental health issues and to their colleagues supporting them. It is all very well having robust policies in place to deal with these issues, but without the means to enforce them and the active support of management, it can be very easy to let these fall by the wayside.

Federal Court Clarifies When Employers Must Pay Employees For Pre- or Post-Shift Activities

A federal court recently provided guidance on an issue that still vexes some employers, i.e., when they must pay employees for time spent on tasks immediately before or after a shift.

Many employers require employees to take certain steps immediately before or after they start their actual shifts. For example, an employer might require an employee to put on protective equipment, pass through a security checkpoint, or drive to a remote jobsite to pick up tools.

In the case at hand, the employees performed construction work at an oil refinery. In order to reach the refinery, the employees needed to follow a unique procedure required by their employer. To help the employer manage traffic at the refinery, the employees needed to travel to a particular bus stop, wait for the bus, and then ride the bus to the refinery before their shifts started. Continue Reading

Webinar: US Employment Law – A Year Into the Trump Era

During the 2016 US election, President Donald Trump promised many changes with the potential to affect businesses and employers across the United States. Join us to learn what has happened, what has not, and what you should do to prepare for 2018 on the employment legal front.

On 7 December 2017 at 4.00 p.m. GMT (incl. the UK) (5.00 p.m. CET, 11.00 a.m. EST, 8.00 a.m. PST), Jill Kirila from our Columbus office and Laura Lawless Robertson from Phoenix will discuss the major judicial decisions, major legislation and executive developments that have taken place during 2017. Jill and Laura will also provide practical tips and guidance to help you appropriately manage your workplace.

The webinar will be a 50-minute presentation followed by a 10-minute online question and answer session.

Intended to help participants manage labour and employment law risk across their international operations, the webinar will be of interest to both HR professionals and in-house counsel.

This webinar is part of our 2017 series focusing on the key labour and employment issues in countries throughout Europe, the Middle East, Asia Pacific and the US.


Paid Family Leave On the Rise – California and New York State Both Set to Expand Benefits Starting January 1, 2018

Come January 1, 2018, employees in California and New York will enjoy new and expanded rights to time off work, with pay, to attend to certain family needs.  New York, whose law was enacted in 2016 (see our prior post here), boasts its law as being the nation’s “strongest and most comprehensive” on paid family leave.    This new law provides job-protected, paid leave to bond with a new child (whether biological, adopted, or foster), care for a loved one with a serious health condition, or address family matters arising from another family member’s call to active military service.  In its first year, the law provides employees with approximately 50% of their average weekly wage for up to 8 weeks; this amount will increase annually until 2021, when it reaches the maximum benefit level of approximately 67% of an employee’s average weekly wage for up to 12 weeks.  The law also requires employers to continue health insurance while an employee is on leave, in the same manner which this health coverage is paid during the employee’s regular employment.  This means that employers can require employees to continue to pay their health insurance premiums while on leave.  The paid family leave program will be funded through an add-on to existing state-mandated employer disability insurance policies.  Employers may choose to pay the additional insurance premiums or deduct the cost from each employee’s payroll.  (Some employers may have begun making these deductions as early as July 1, 2017).  Of note, this law does not just apply to employers located in New York State.  Any employer with employees working in New York for 30 or more days in a calendar year must have paid family leave insurance coverage.  Continue Reading