E-Newsletter, October 2007

In this issue:

Employment Verification and I-9 Compliance: Avoiding Penalties.

By Mariana D. Bravo, Esq. and Tina M. Maiolo, Esq.

All employers must complete and maintain I-9 Employer Eligibility Forms (“I-9 Form”) for each employee hired on or after November 6, 1986.  Completion of the I-9 form is required for each employee regardless of the employee’s immigration status.  The general purpose of the I-9 form is to ensure and verify the identity and employment of workers.  I-9 forms ensure that an individual is authorized to work, thereby deterring undocumented workers from being employed.  Strict compliance with I-9 form completion is essential for all employers to avoid potential liability and criminal prosecution.

All employers must ensure that every item on the I-9 form, which consists of two parts, is completed.  The first part requires the employee to attest that he/she is a citizen, lawful permanent resident, or alien authorized to work temporarily.  Employers, in the second part, are required to document that they have examined documents, set forth in an approved list, verifying and certifying the employee’s identity and eligibility to work.  The documents must be accepted by the employer if they appear to be “reasonably genuine,” and the documents appear to correspond with the employee submitting the documents.  In so doing, employers must be careful to avoid excessively scrutinizing documents of individuals who may look or sound foreign.  Federal immigration laws prohibit employers from considering foreign appearance, accents, or national origin related to their hiring practices. Employers must, therefore, avoid any discriminating hiring practices.  Employers should implement I-9 form completion policies and procedures that are put into practice uniformly and consistently for each hiring situation.

The I-9 form must be completed, signed, and dated by each employee no later than three business days of the employee’s start date.  The I-9 form must thereafter be maintained by the employer for three years from the date of hire, or one year after the last date worked, whichever date is later.  An employer is not required to keep an I-9 form for independent contractors.  It is important to note, however, that employers who have actual and/or constructive knowledge that contractors with whom they are working are employing undocumented workers to perform any work may be liable.  Constructive knowledge is that which an employer may infer through learning of certain facts and circumstances that would lead an employer, through the exercise of reasonable care, to learn and know about a person’s identity and eligibility to work.  Furthermore, employers may not knowingly hire or continue to employ an undocumented worker.

Employers should be careful to not circumvent I-9 compliance requirements as they may face both civil and criminal penalties.  Failure to do so can result in fines of $110-$1,100 for a deficient I-9 form.  An employer may also be faced with additional fines and consequences if there is a finding of “pattern and practice” of improperly completed I-9 forms.  Deficient I-9 forms could also result in suspension or interference of the employer’s operations as well as potential negative publicity.”


Lilly Ledbetter Fair Pay Act of 2007 Would Increase Statute of Limitations Period Relating to Employee Compensation Discrimination Claims

By: Thomas L. McCally, Esq. and Cedric D. Miller, Esq.

During Congress’ first session of 2007, the House of Representatives passed H.R. 2831: Ledbetter Fair Pay Act of 2007.  The bill’s stated purpose is “to amend Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act of 1990, and the Rehabilitation Act of 1973 to clarify that a discriminatory compensation decision or other practice that is unlawful under such Acts occurs each time compensation is paid pursuant to the discriminatory compensation decision or other practice, and for other purposes.”  See H.R. 2831, 110th Cong., 1st Sess. (2007).  In passing H.R. 2831, Congress specifically found that the “Supreme Court . . . significantly impairs statutory protections against discrimination in compensation that Congress established and that have been bedrock principles of American law for decades.”  Id.  Congress further found that the “limitation imposed by the Court on the filing of discriminatory compensation claims ignores the reality of wage discrimination and is at odds with the robust application of the civil rights laws that Congress intended.”  Id. at § 2(2).  Congress also intended to make clear that with regard to any charges of discrimination under any law that nothing in the Act is intended to preclude or limit an aggrieved person’s right to introduce evidence of unlawful employment practices that have occurred outside the time for filing a charge of discrimination.   Id. at § 2(3).

In terms of its practical application, the Ledbetter Fair Pay Act amends the Civil Rights Act of 1964 to declare that an unlawful employment practice occurs; when a discriminatory compensation decision or other practice is adopted; when an individual becomes subject to the decision or practice; or, when an individual is affected by application of a discriminatory compensation or other practice – including each time wages, benefits, or other compensation is paid, resulting in whole or in part from such a decision or other practice.  See Id. at § 2(3).  H.R. 2831 also allows liability to accrue, enabling an aggrieved person to obtain relief, including recovery of back pay for up to two years preceding the filing of the charge, where the unlawful employment practices that have occurred during the charge filing period are similar or related to practices that occurred outside the time for filing a charge.  Id. at § 3.  These amendments apply equally to claims of discrimination under the Americans with Disabilities Act of 1990 and the Rehabilitation Act of 1973.  Id.  H.R. 2831 also amends the Age Discrimination in Employment Act of 1967 to declare that an unlawful practice occurs when a discriminatory compensation decision or other practice is adopted; when a person becomes subject to the decision or other practice; or, when a person is affected by application of a discriminatory compensation decision or other practice – including each time compensation is paid.  It also allows a person filing an action to challenge similar or related instances of compensation discrimination after an aggrieved person filed a charge without filing another charge with the Secretary.  Id.

H.R. 2831 was introduced in the House of Representatives on June 22, 2007.  On July 31, 2007, it passed the House of Representatives by roll call vote of 225 to 199.  It was received and read for the first time in the Senate on August 1, 2007, and was read the second time and placed on the calendar on August 2, 2007.  However, if the Act is passed by the Senate, it faces a strong chance of veto by President Bush as it is currently drafted.  See Statement of Administration Policy, H.R. 2831 – Lilly Ledbetter Fair Pay Act of 2007, dated July 27, 2007.  Employers should monitor the development of the Act, for if it does become law, it would create exposure for previously time-barred Title VII claims.

The Ledbetter Fair Pay Act came as a result of the US Supreme Court’s decision in Ledbetter v. Goodyear Tire & Rubber, Inc., 127 S. Ct. 2162 (2007).  In Ledbetter, the United States Supreme Court decided whether, and under what circumstances, a plaintiff may bring an action under Title VII of the Civil Rights Act of 1964 alleging illegal pay discrimination when the disparate pay is received during the statutory limitations period, but is the result of intentionally discriminatory pay decisions that occurred outside the limitations period.  In a 5-4 decision, the high court ruled that such a claim is time-barred.   See Ledbetter v. Goodyear Tire & Rubber, Inc., 127 S. Ct. 2162 (2007).

Lilly Ledbetter sued her former employer Goodyear Tire & Rubber for discrimination relating to the terms of her pay under Title VII of the Civil Rights Act of 1964 and the Equal Pay Act.  Plaintiff’s complaint centered around the fact that during the course of her 19 years of employment she received negative performance evaluations early in her career that caused her to receive substantially lower pay than all of her male colleagues later in her career.  The United States District Court for the Northern District of Alabama granted summary judgment in favor of the employer on plaintiff’s Equal Pay Act claim.  However, the United States District Court allowed plaintiff’s Title VII claim to proceed to trial and the jury entered a verdict in favor of Plaintiff.

On appeal, Goodyear argued that plaintiff’s pay discrimination claim was barred by the statute of limitations with respect to all pay decisions made before September 26, 1997 (representing 180 days before plaintiff initially filed her EEOC questionnaire in March of 1998).  The U.S. Circuit Court of Appeals for the Eleventh Circuit reversed the decision of the lower court.  The court of appeals held that a Title VII pay discrimination claim cannot be based on a pay decision that occurred before the last pay decision that affected the employee’s pay.  The Eleventh Circuit also held that “there was insufficient evidence to prove that Goodyear had acted with discriminatory intent in making the only two pay decisions that occurred within that time span, namely, a decision made in 1997 to deny Plaintiff a raise and a similar decision made in 1998.”  Id.

The Supreme Court affirmed the decision of the Eleventh Circuit, holding that “the EEOC charging period is triggered when a discrete unlawful practice takes place, [and that a] new violation does not occur, and a new charging period does not commence, upon the occurrence of subsequent nondiscriminatory acts that entail adverse effects resulting from the past discrimination.”  Id. at 2169.

In determining Ledbetter’s fate, the Supreme Court reasoned that plaintiff’s “attempt to take the intent associated with the prior pay decisions and shift it to the 1998 pay decision was unsound because it would shift intent from one act (the act that consummates the discriminatory employment practice) to a later act that was not performed with bias or discriminatory motive.”  Id. at 2170.  The Court further reasoned that the effect of this shift would be to impose liability in the absence of the requisite intent.  In holding plaintiff’s claim untimely, the Court concluded by rejecting “the suggestion that an employment practice committed with no improper purpose and no discriminatory intent is rendered unlawful nonetheless because it gives some effect to an intentional discriminatory act that occurred outside the charging period.”  Id. at 2171.

District Law Now Requires Reporting of Malpractice Settlements, Physician Discipline and “Adverse Events.”

By Edward J. Krill, Esq. and Michael J. Sepanik, Esq.

In December 2006, the Medical Malpractice Amendment Act of 2006 was enacted by the District of Columbia Council.  The new law incorporates “tort reform” practices into the litigation of malpractice cases and requires reporting of settlements and judgments in malpractice cases, physician discipline and “adverse events.”  Interim Guidelines to the new law were issued on July 3, 2007.  The law went into effect on July 1, 2007 except for the adverse event reporting requirements.

Litigation Procedures:
The amendments do not substantively alter the way in which a medical malpractice suit is litigated within the District of Columbia, but the amendments may encourage case resolution prior to extensive and costly discovery taking place.

The practical implications of the amendments are two-fold.  First, the amendments include a 90-day notification requirement prior to suit. Thus, prior to filing an action alleging malpractice against a health care provider, written notice must be provided to the health care provider of the intent to file a claim at least 90 days prior to filing.  The three-year statute of limitations remains in place, and providing written notice of the intent to file to the health care provider within the three year period satisfies the statute of limitations.

Second, the amendments require that in all cases alleging medical malpractice, the parties enter into an early mediation, i.e., within 30 days of the Court’s issuance of the initial scheduling order.  The amendments may increase the likelihood of success during mediation as only judges or lawyers with at least ten years of “significant” experience in medical malpractice litigation are eligible to act as mediators.

Reporting Malpractice Payments:
Under the new legislation, the District’s physicians are required to report any judgment or settlement stemming from professional malpractice allegations to the District of Columbia Board of Medicine within 60 days.  The information compiled by the District of Columbia Board of Medicine will be placed into an online database accessible to the public.   The database has been established and it is now possible to obtain a practitioner profile by physician name on line at hpla.doh.dc.gov/.  All such payments must be reported by the physician, regardless of the amount paid in settlement or awarded as a judgment.  Thus nuisance payments and settlements for the cost of litigation are as reportable as a payment subsequent to a finding of malpractice.

Reporting Discipline: 
Health care providers who employ physicians must report “any disciplinary action” within 10 days of the action.  This requirement is broad enough to encompass a reprimand for failure to complete medical records.  Unlike the current National Practitioner Data Bank reporting, the discipline to be reported is not limited to clinical matters, or to serious discipline such as a suspension of privileges.

Reporting “Adverse Medical Events:”
Any death or unanticipated injury to a patient must be reported by hospitals and physicians licensed in the District of Columbia to the Health Regulation and Licensing Administration.  These reports are due beginning January 1, 2008, but must include adverse medical events occurring since July 1, 2007.  The events to be reported include the 28 incidents identified by the National Quality Forum at http://www.qualityforum.org/. The eight page reporting form available on the Department’s website, noted, lists these 28 events. To be reportable, events must have resulted in death or “serious disability.” Reportable events also include hospital-acquired blood infections as per the CDC National Healthcare Safety Network.

Patient injuries occurring in a private physician’s office are clearly reportable under this new law. For example, a serious disability associated with a medication error is expressly reportable, as are in-office surgical mistakes involving the wrong site or incorrect procedure. The report form and Guidelines do much to address the initial response to this reporting requirement as being too vague, to the point where physicians “…have no idea what to report.”  S. Levine,WashPost 2/28/06. Reports must include a corrective action plan designed to prevent recurrence.

Regulations Anticipated:
The Guidelines issued on July 3, 2007 expressly state that the Department is in the process of drafting regulations that will further define and explain this new law.  The limitations on adverse event reporting now found in the Guidelines and on the reporting form could be significantly broadened by these regulations, since the law contains a very broad definition of “adverse event,” i.e. any “unanticipated patient injury.”  For information regarding the status of that effort, interested parties are advised to call Lisa Robinson, Licensing Specialist at 202-724-8802.

Are Voluntary Employee Events “Work” under the Fair Labor Standards Act?

By Edward J. Krill, Esq.

The Fair Labor Standards Act (“FLSA”) covers employer compensation liability for mandatory or voluntary meetings and gatherings conducted on company premises.

Whether such meetings will be considered “work” depends foremost upon whether they are mandatory.  Mandatory meetings are clearly compensable “work” under the FLSA.  If meetings are not mandatory, then the subject matter or purpose of the meeting determines whether it is compensable work time.  A voluntary meeting of employees, sponsored and arranged by the employer, that deals primarily with work related information or activities is compensable under the FLSA.  However, primarily social events, that are voluntary (even when held at the workplace), do not constitute “work” under the FLSA.

Any time spent as the employer directs is compensable “work” under the FLSA.  Thus waiting for an assignment, or being on stand by and simply occupying a place, at the direction of the employer are all considered working hours.  Any mandatory meeting of employees is, therefore, compensable work, even if the subject matter is a Christmas cookie exchange, birthday celebration or office “happy hour.” These mandatory social events are considered work time which must be paid at the minimum wage rate and count toward overtime.  29 U.S.C. §§ 206-07.

Optional events sponsored by the employer that involve “physical or mental exertion (burdensome or not) controlled or required by the employer, and pursued necessarily and primarily for the benefit of the employer, are also considered “work” time. Tennessee Coal, Iron & Railroad v. Muscoda Local No. 123, 321 U.S. 590 (1944).  Thus an optional, voluntary training program directly related to work performance will be considered compensable time.  An optional, but encouraged, technical seminar or educational program held by a third party off-site, but sponsored and paid for by the employer as a means of training or advancement within the company, would likely be considered work time. See 29 C.F.R. §785.27-31.  However, an educational program that is not directly related to the employee’s specific work, such as classes toward a general degree, is not considered compensable work time even if the employer pays the tuition.  29 C.F.R. § 785.29.

Purely social events that are optional such as a company picnics, late day “happy hours,” company sponsored sports team activities and gatherings of employees for lunch together in the office is not compensable work time, even if on employer premises and permitted by the employer to promote employee morale and team building – because the subject matter of the gathering in primarily social. This is especially true if the event is organized by the employees and occurs outside of regular working hours. See W&H Administrator’s Opinion FLSA 2006-5.

In evaluating whether an event should be considered work or an employee social gathering, an employer should consider:  (a) who is arranging the activity; (b) whether it will be held during regular work time; (c) the expectations regarding attendance even if not mandatory; and (d) whether there will be communications or activities conducted by the employer.  The greater the involvement of management and the clearer the work-related purpose, the more likely the event will be considered work under Department of Labor guidelines.