Wyatt Employment Law Report


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Department of Labor Issues Proposed New Rules Governing Whistleblower Proctections Under the Affordable Care Act

By Douglas L. McSwain

The interim Final Insurance Market Reform Rule under the Affordable Care Act (ACA) came out this past week, and included the employment non-discrimination/whistleblower protection provisions.  This rule could very well become one of the most litigious employment law developments in some time. Employers are prohibited from discriminating against any employee who complains in good faith that an employer is not providing healthcare coverage benefits in compliance with the ACA.  Employers and their insurers are also prohibited from discriminating against employees who participate in any complaint to a state or federal official about the perceived inadequacies of the employer’s coverage of health benefits, and, critically important, against any employee who chooses to go into the insurance exchange to purchase individual health coverage (thereby triggering, for any “large” employer, exposure to a tax penalty if it has failed to provide its employees “affordable” and at least 60% actuarially-valued, coverage). 

Employees may bring a complaint of discrimination (i.e., “blow the whistle” on an employer) within a 180-day limitations period by lodging an oral or informal written complaint (in letter-form or otherwise) with the U.S. Occupational Safety and Heath Administration (“OSHA”).  Under the new rule, reinstatement or front pay is available as remedies, as well as backpay, attorneys fees, expert fees, costs, etc.  If reinstatement is ordered, it must be done immediately pending appeal unless infeasible, in which event, front pay is awardable.  If a prima facie discrimination case is made out by an employee, the employer bears a “clear and convincing burden,” in effect, to disprove that any adverse employment action would have been taken in any event (interesting burden-shift here, and perhaps of questionable validity).  On the other hand, for frivolous or bad faith employee-filings, employers may be awarded up to, but no more than, $1,000 in attorneys fees against a frivolous-filing employee. OSHA filings are exhausted in the administrative setting before an Administrative Law Judge, and appeals are to the U.S. Court of Appeals. However, if a complaint remains unaddressed by OSHA for over 210 days, the case may be initiated by a filing in federal district court, subject to de novo review. 

These are significant developments in employment and employee benefits law. You may find the proposed new employment rules on the DOL’s website regarding the non-discrimination/whistleblower regulations: http://www.dol.gov/find/20130222/OSHA2013.pdf


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NLRB Rules For Employer Finding No Obligation To Reinstate Or Pay Backpay to Illegal Aliens

By Edwin S. Hopson

On August 09, 2011, the National Labor Relations Board issued its decision in Mezonos Maven Bakery, 357 NLRB No. 47 (2011), in which it held that the Supreme Court’s decision in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137(2002) was binding upon the Board in deciding that it lacked the authority to award backpay to undocumented immigrant workers whose rights under the National Labor Relations Act had been violated.  This was found to be so even if the employer knew at the time the undocumented workers were hired that they lacked employability with the meaning of the Immigration Reform and Control Act of 1986 (IRCA).

On February 12, 2003, seven employees who worked for Mezonos Maven Bakery were discharged after complaining about treatment they were receiving from a supervisor.  Charges were filed alleging a violation of the Act over this retaliation for engaging in protected concerted activity.  The case was settled but the employer later refused to offer reinstatement or backpay citing the fact that the seven employees were undocumented workers.  An NLRB Administrative Law Judge ruled against Mezonos Maven Bakery and it appealed to the Board, which ruled for the Bakery.

However, two of the NLRB’s three member panel, Chairman Liebman and Member Gaston, criticized the Supreme Court’s 2002 ruling, stating “in addition to the obvious failure to make employee-victims whole the Act’s enforcement is undermined, employees are chilled in the exercise of their Section 7 rights, the workforce is fragmented, and a vital check on workplace abuses is removed.”  Member Hayes refused to join in that criticism stating “it is the Board’s role to enforce this controlling precedent in adjudicatory proceedings without critical comment.  It is the role of Congress to determine whether to alter the law in response to the Court’s decision.”

Liebman and Gaston also postulated that they “would be willing to consider in a future case any remedy within our statutory powers that would prevent an employer that discriminates against undocumented workers because of their protected activity from being unjustly enriched by its unlawful conduct.”  Hayes also refused to speculate about future other possible remedies.