Healthcare Workers Under the Influence

An impaired medical employee can create risk to patients and legal liability for employers. There are several items healthcare employers can include in a drug and alcohol policy to create a safe, drug-free workplace. Elaina Smiley addresses this in her article “Healthcare Workers Under the Influence” on page 4 of this issue of Western Pennsylvania Healthcare News.

Congratulations to Nicholas Bell!

Congratulations to Nicholas Bell! He was elected by the Pennsylvania Bar Association to serve in its House of Delegates for a 3-year term. Read the full announcement.

Real Estate Roundup

We are proud to sponsor the upcoming Real Estate Roundup. The event is hosted by the Urban Land Institute of Pittsburgh on May 6 at the Rivers Club. If you’re a real estate professional visit this page for more info.

EEOC Sues CVS Pharmacy

The Equal Employment Opportunity Commission ("EEOC") recently commenced litigation against CVS Pharmacy, Inc., in the U.S. District Court for the Northern District of Illinois claiming that certain provisions of a severance agreement used by CVS violates Title VII of the Civil Rights Act of 1964 because it is "overly broad, misleading and unenforceable..." Equal Employment Opportunity Commission v. CVS Pharmacy, Inc., Civil Action No. 14 C 0863 (N.D. Ill., February 7, 2014).


According to the EEOC, "CVS conditioned the receipt of severance benefits for certain employees on an overly broad severance agreement set forth in five pages of small print. The agreement interfered with employees' right to file discrimination charges and/or communicate and cooperate with the EEOC." (EEOC Press Release, 2/7/14.)

The EEOC identified various sections of the CVS Agreement that violated Title VII:

• A cooperation clause requiring the employee to promptly notify CVS' General Counsel if the employee is contacted related to legal proceedings including contacts by "any investigator, attorney or any other third party."
• A non-disparagement clause prohibiting the employee from making any disparaging statements about CVS and its officers, directors, and employees.
• A non-disclosure provision prohibiting disclosure to any third party of confidential information without prior written permission of CVS.
• A general release of claims that included a release of all "causes of action, lawsuits, proceedings, complaints, charges, debts contracts, judgments, damages, claims, and attorney fees," including "any claim of unlawful discrimination of any kind."
• A covenant not to sue clause where the employee represents that he/she has no pending lawsuit against CVS and prohibits the employee from filing any lawsuit. In the event of a breach, the employee is required to reimburse CVS for any legal fees that it incurs resulting from the employee's breach of the covenant not to sue.
• A provision stating that in the event of the employee's material breach of the Employee Covenants section of the agreement, CVS would be entitled to obtain injunctive and other relief, including attorney fees.

Based on these sections, the EEOC claims that CVS is engaging in a "pattern or practice of resistance to the full enjoyment of the rights secured by Title VII" alleging that such provisions deter the filing of charges and interferes with an employee's ability to communicate voluntarily with the EEOC and Fair Employment Practice Agencies. "Charges and communication with employees play a critical role in the EEOC's enforcement process because they inform the agency of employer practices that might violate the law[.] For this reason, the right to communicate with the EEOC is a right that is protected by federal law. When an employer attempts to limit that communication, the employer effectively is attempting to buy employee silence about potential violations of the law. Put simply, that is a deal that employers cannot lawfully make." (EEOC Press Release, 2/7/14.)


Although the EEOC notes that the CVS Agreement contains a statement that "[n]othing in this paragraph is intended to or shall interfere with an Employee's right to participate in a proceeding with any appropriate federal, state or local government agency enforcing discrimination laws[,]" the EEOC found this disclaimer ineffective, stating that it is a "single qualifying sentence that is not repeated anywhere else in the Agreement[.]"


While there is no ruling yet on the litigation filed by the EEOC against CVS, (and it is possible that the EEOC's complaint, ultimately, will be dismissed in its entirety), in light of the EEOC's current position about language in separation agreements, employers should carefully review their agreements, being mindful of the length of the agreement, any limitations on an employee's rights and abilities to file administrative charges alleging discrimination, as well as any provisions limiting an employee's communications to administrative agencies and third parties.
  

Beth Slagle has practiced law for more than 20 years and focuses her practice on business disputes and employment law. Beth's work has earned her a spot in Best Lawyers in America since 2010, and she is the chair of the firm's Insurance Coverage Litigation Group. She can be reached at bas@muslaw.com or412.456.2890.

Corporate Sustainability Trends

Sustainability issues have become more prominent on corporate agendas. This article offers a look at the latest trends in corporate sustainability, "6 Latest Trends in Corporate Sustainability".

Photos of UnCommon Pleas

This BroadwayWorld.com article offers a few photos from PICT Theatre’s inaugural performance of UnCommon Pleas featuring Dennis Unkovic as Macbeth.

Health Care Employees Can Reap Benefits From Employment Reviews

Hospitals, physician’s practices and other health care employers can protect themselves by conducting regular employment reviews. Learn more in Patricia Farrell’s article “Health Care Employees Can Reap Benefits From Employment Reviews” on page 11 of this issue of Western Pennsylvania Healthcare News.

Overtime Rule Change For White Collar Workers

On March 13, 2014, President Obama signed a presidential memorandum, instructing the Secretary of Labor to update overtime regulations. The proposal would amend the regulations related to the Fair Labor Standards Act ("FLSA") to make overtime compensation available to a larger pool of employees who are currently exempt from federal overtime requirements. It is estimated that if implemented, this change could affect millions of workers who work more than forty hours in a workweek.

The proposed rule change may extend the availability of overtime compensation to employees currently classified exempt from overtime which could include workers such as store managers, restaurant managers, certain office workers and potentially others. Currently, workers meeting the requirements of executive, administrative or professional employees are exempt from being paid overtime if they are paid a fix salary of at least $455 a week and meet certain requirements pursuant to the Department of Labor regulations. The White House's position is that inflation has eroded the $455 a week salary requirement below the poverty line and has recommended increasing the $455 per week minimum salary threshold, which may be doubled under the new regulations.

It is anticipated that the changes may also affect the "duties test" for the executive exemption. Currently, under the "duties test," a manager is permitted to perform non-exempt duties for a majority of the day without losing the exemption as long as the primary (or most important) duty is management. Potential changes could require that a manager spend a larger percentage of his or her time performing executive or management duties in order to be classified as exempt. For instance, a store manager who performs non-managerial tasks for a majority of the day, such a stocking shelves and performing cashier duties, may not qualify as exempt and may be entitled to overtime compensation under the new regulations.

It will likely be many months before these proposals become final regulations, as they will have to go through the notice and comment period required under the Administrative Procedures Act. When changes were made to the FLSA in 2004, it took in excess of a year for the proposed changes to become effective.  Because the presidential memorandum leaves much room for interpretation, it is difficult to predict the extent of changes that the Department of Labor will implement.

For more information on this new memorandum or any other employment law issues, please contact Elaina Smiley or Gary Sanderson.

Exploring Employee Incentives

Exploring employee incentives? There are some useful facts, figures and incentives for rewards and recognition in this article, "Exploring Employee Incentives".

Don't Forget Punctuation

In a recent bankruptcy court ruling, a creditor lost its security interest in the assets of a bankrupt company because it left two periods and one space out of its paper work. In this article, "Don't Forget Punctuation", Christopher Smith addresses why you want to use exact punctuation when preparing financial documents.

Keep Old and New Businesses Separate

Patricia Farrell’s recent Pittsburgh Post-Gazette article looks at the risks associated with co-mingling the operations, employees and equipment of two different businesses and addresses why you may want to consider keeping them separate. You can read it at "Business Workshop: Keep Old and New Businesses Separate".

An Overview of Business Forms

If you’re considering starting a new business have a look at this page, "An Overview of Business Forms". It highlights tax implications for different structures of businesses.

Watch out for CFIUS

More Western Pennsylvania businesses than ever are looking to foreign investors for capital or as potential buyers. But entrepreneurs should understand that the federal government, in the form of the Committee on Foreign Investment in the United States (CFIUS), may block or modify such deals.

Dennis Unkovic addressed this topic in yesterday's Pittsburgh Post-Gazette. You can read the article at "Watch out for CFIUS".