Is a Labor Union Preventing You From Buying Beer on a Sunday in Minnesota?

Minnesota is one of the few remaining states to prohibit alcohol sales on Sunday, and a labor union is fighting to keep it that way – but not for reasons that have anything to do with the merits of the legislation.

Every year, there is talk of a legislative effort to repeal Minnesota’s ban on Sunday alcohol sales, and every year, the effort fails. Minnesota first banned Sunday alcohol sales in 1858 for religious reasons. The law was renewed in 1933 after prohibition ended, and it has remained the same ever since. The law only prohibits liquor stores from selling alcohol on Sundays – it does not affect alcohol sales in bars or restaurants.

The Minnesota liquor industry opposes Sunday sales because they claim that Sunday sales would result in extra operating expenses without significant additional sales. But the many Minnesotans who drive to Wisconsin to buy alcohol on Sundays seems to undercut that argument.

Another major opponent of Sunday sales in Minnesota is the Teamsters Union. The Teamsters’ opposition to Sunday sales has nothing to do with religion, the health effects of alcohol, or the business of running liquor stores. Instead, the Teamsters oppose the possibility of Sunday sales in Minnesota because a change in law might allow some employers in the liquor industry to reopen their contracts with the Teamsters for bargaining.  Last year, the Teamsters lobbied the legislature to prevent any repeal of the Sunday sales ban, and the repeal effort failed.

Advocates of repealing the ban on Sunday sales, on the other hand, argue that: (i) the ban puts Minnesota at a competitive disadvantage to surrounding states and Canada; (ii) repealing the ban would generate an extra $10.6 million in tax revenue for the state; and (iii) repealing the ban would help support the growing craft beer industry in Minnesota. Governor Mark Dayton has previously said that he would sign a bill repealing the law if it was passed by the legislature.

Takeaway: Sometimes labor issues can have broader effects than employer-employee relations. If you feel strongly about the Sunday sales issue in Minnesota – one way or the other – consider contacting your state representatives to let them know how you feel.

A WARN Act Refresher for Potential Mass Layoffs In North Dakota

Due to the steep decline in the price of oil, there are predictions that mass layoffs may soon come to the areas of North Dakota that recently benefited from the oil boom.

In the past several years, North Dakota had one of the highest rates of job growth due to the expanding oil industry there. The oil boom resulted in fast-food jobs that reportedly paid up to $20 per hour and caused the average rent in Williston, North Dakota to exceed the cost of rent in cities like New York and Los Angeles.

But times are changing. Between June of 2014 and January of 2015, the average cost of Brent crude oil dropped by more than half, from $115 per barrel to $49 per barrel. Now, CNN is reporting that at least one CEO is predicting that there could be as many as 20,000 layoffs in North Dakota by June due to a significant decrease in oil production.

Hopefully, the prediction of 20,000 job losses will not come to pass. If it does, however, here’s what employers should know about mass layoffs in North Dakota:

  • Unlike Minnesota, North Dakota does not have a state “Mini-WARN” act that requires advance notice for mass layoffs or plant closings. But employers may still need to comply with the 60-day notice requirement of the federal Workers Adjustment and Retraining and Notification (“WARN”) Act.
  • For a general summary of what the federal WARN Act requires, when it applies, and which employers are subject to the WARN Act, click here.
  • For a summary of what information needs to be included in a WARN Act notice to employees, click here.
  • For a summary of potential exceptions to the WARN Act’s 60-day notice requirement, click here. But don’t forget that even if an exception applies, some prior notice may still be required.

Takeaway: Employers who are facing potential mass layoffs in North Dakota or elsewhere should make sure to comply with any notice requirements imposed by the federal WARN Act or similar state laws.

New Minnesota Expungement Law Protects Employers

An amendment to Minnesota’s laws concerning the expungement of criminal records is designed to help protect employers from claims based on the conduct of their employees.

Expungement is a process authorized by statute that allows an individual to seek to have records related to prior criminal convictions or charges sealed so that they are no longer accessible by the public. Expungement is only available in limited circumstances, such as after an individual has successfully completed a diversion program, has been exonerated, or if the individual was convicted of a low-level crime and has had no other convictions for several years. Expungement is not available for high-level crimes like murder, kidnapping, or criminal sexual conduct. See Minn. Stat. § 609A.02.

The new amendment to Minnesota’s expungement laws took effect on January 1, 2015, and protects employers by prohibiting expunged criminal records from being admitted into evidence in a civil case against an employer based on an employee’s conduct. The new provision states that:

Information relating to a criminal history record of an employee, former employee, or tenant that has been expunged before the occurrence of the act giving rise to the civil action may not be introduced as evidence in a civil action against a private employer or landlord or its employees or agents that is based on the conduct of the employee, former employee, or tenant.

Minn. Stat. § 609A.03, subd. 5(e).

Takeaway: The new amendment to Minnesota’s expungement laws will help protect employers against claims based on employee conduct, such as claims for negligent retention or claims based on respondeat superior liability.

White House Announces Paid Leave Initiative

One of the proposals that President Barack Obama will discuss at the upcoming State of the Union address is the White House’s new initiative to support paid leave for employees. The initiative has several components, including the following:

The Healthy Families Act: The Obama administration is supporting proposed legislation entitled “The Healthy Families Act,” which would require employers with 15 or more employees to allow employees earn at least 1 hour of paid sick time for every 30 hours worked, up to a maximum of 56 hours per year. Given the current Republican control of the House and Senate, however, it is unlikely that this legislation will pass in the near future.

Paid Parental Leave for Federal Workers: On January 15, 2015, President Obama signed a memorandum directing federal agencies to agencies to allow federal workers to take up to six weeks of paid sick leave to care for a new child or ill family members. The federal agencies will be required to advance the paid sick leave to employees who have not accrued a sufficient amount of paid leave to cover the absence.

Paid Leave Funds for State Workers: The President’s budget for 2015 will propose allocating $50 million to a State Paid Leave Fund for the Department of Labor to provide competitive grants to states to help them launch paid leave programs for state employees.

By providing paid leave to federal employees and encouraging state governments to do the same for state employees, the White House’s new paid leave initiative is intended not only to offer paid leave to government employees, but also to increase market pressure on private employers to offer competitive benefits. In Minnesota, the City of St. Paul recently began offering paid parental leave to city employees, and Minneapolis is considering adopting a similar policy. Other cities that offer paid parental leave to employees include Chicago, Illinois, San Francisco, California, and Austin, Texas.

Paid leave legislation is also possible at the state level.  Several states – such as California, Connecticut, and Massachusetts – have recently passed laws requiring certain employers to offer paid leave to employees.  So far, this legislation has not passed in Minnesota, but it has been discussed as a potential follow-up to last year’s Women’s Economic Security Act legislation.

Takeaway: Although federal legislation requiring private employers to offer paid leave is unlikely in the near future, the federal government as well as some state and local governments are implementing paid leave programs with the goal of increasing the pressure on private employers to adopt similar policies.  Employers should continue to monitor these efforts as well as state legislation concerning paid leave.

Does the FLSA Require Employees To Be Paid For a Meal Break If They Have To Monitor a Radio While Eating?

No – a recent decision from the Sixth Circuit Court of Appeals rejected the argument that monitoring a radio during a meal break was compensable work time under the Fair Labor Standards Act (FLSA).

In Ruffin v. Motorcity Casino, d/b/a Detroit Entertainment, L.L.C., a group of security guards argued that their meal breaks should have counted as hours worked under the FLSA.  No. 14-1444 (6th Cir., Jan. 7, 2015).  During the meal breaks, the security guards were required to remain on the premises, monitor their two-way radios, and respond to emergencies if called to do so.  Otherwise, the security guards were able to use their meal break time as they wanted.  The security guards’ primary argument was that the requirement to monitor their two-way radios converted the meal break time into work time for purposes of the FLSA because they had to constantly monitor the chatter on the radios in order to know if an emergency required their attention.

The Sixth Circuit rejected the security guards’ argument.  The court applied that general principle that meal break time is only compensable under the FLSA if it is spent predominantly for the benefit of the employer.  The court cited a number of other cases that held that monitoring a radio is not substantial enough to convert a meal break into hours worked.  The court further noted that the evidence supported the conclusion that the security guards could their meal break time as they chose – for example, by eating, reading, socializing, and conducting personal business on their phones – despite needing to monitor their radios.  As a result, the court held that the radio-monitoring requirement was a de minimis activity, not a substantial job duty, and did not require payment under the FLSA.

Takeaway:  Imposing minimal requirements on an employee during his or her meal break – such as requiring the employee to remain on premises or monitor a two-way radio – generally is insufficient to require payment for the meal break under the FLSA.

Can Employers Monitor Employee Emails?

Yes – employers generally can monitor employee emails sent using an employer-provided account, but it’s best for employers to take certain steps to ensure that the monitoring is lawful.

Whether an employer can monitor employee emails sent using company email typically depends on whether the employee has a reasonable expectation of privacy in the emails.  One of the leading cases on this subject is In re Asia Global Crossing, Ltd., in which the court developed a four-factor test for analyzing whether an employee’s emails are subject to a reasonable expectation of privacy.  322 B.R. 247 (S.D.N.Y. 2005).  The court held that the four factors that should be considered are:

  1. Does the corporation maintain a policy banning personal or other objectionable use?
  2. Does the company monitor the use of employee’s computer or email?
  3. Do third parties have a right of access to the computer or emails?
  4. Did the corporation notify the employee, or was the employee aware, of the use and monitoring policies?

The four factors make clear that an employer will have a much greater likelihood of defeating any alleged expectation of privacy in company emails if the company maintains a policy that clearly communicates to employees that the employer reserves the right to monitor and access employee emails and that employees should have no expectation of privacy in their use of company-provided email accounts.

Other potential options that employers can use to eliminate any ambiguity regarding the non-private nature of employee emails are:  (i) requiring employees to sign an acknowledgement stating that they have no expectation of privacy in company emails; (ii) using on-screen warnings when an employee logs on to his or her computer warning that emails are subject to monitoring; or (iii) providing periodic trainings to employees that reinforce the company’s email-monitoring policy.

Takeaways:  Employers who want to safeguard their right to access and monitor employee emails should make clear their intent and warn employees not to expect privacy in their emails, either by adopting an email monitoring policy or through other steps.

Does a Single Nipple Squeeze Constitute Sexual Harassment?

No – the Eighth Circuit Court of Appeals recently held that a supervisor’s single squeeze of an employee’s nipple was not actionable as sexual harassment under Title VII – even though the supervisor himself characterized the squeeze as “sexual harassment.”

In Rickard v. Swedish Match North America, Inc., there was no dispute that the plaintiff’s supervisor was crude and obnoxious, but that was not enough to give the plaintiff actionable claims under federal law. The plaintiff, a male, alleged that his male supervisor subjected him to increased scrutiny and criticism of his job performance. In addition to a handful of comments related to the plaintiff’s age, the plaintiff alleged that on one occasion, the supervisor squeezed his nipple and stated “this is a form of sexual harassment.” On another occasion, the supervisor took a towel from the plaintiff, rubbed it on his crotch, and then handed it back to the plaintiff. After the plaintiff complained about this conduct, however, the plaintiff never experienced similar conduct from the supervisor. After the plaintiff retired, he asserted claims against the employer for violations of Title VII and the Age Discrimination in Employment Act (ADEA).

The Eighth Circuit affirmed dismissal of all of the plaintiff’s claims on summary judgment. Although the court characterized the supervisor’s conduct as “manifestly inappropriate and obnoxious,” the court held that there was no evidence that the nipple-squeeze and towel incidents were “based on sex” or hostility against men in the workplace. The court noted that the plaintiff admitted the supervisor never pursued him romantically and presented no evidence that the supervisor’s conduct was based on sexual desire. The court also rejected the plaintiff’s argument that the supervisor’s statement that “this is a form of sexual harassment” proved his case, stating that “[t]his court will not take the statement of a layperson . . . as definitive proof that his actions qualified as sexual harassment under the law.”

With respect to the ADEA claim, the court held that the handful of age-based comments alleged by the plaintiff were “simple teasing or offhand comments” and were insufficient to prove an objectively hostile work environment.

Takeaway: The court’s holding in Rickard adds to a long line of cases in which inappropriate workplace behavior did not meet the high threshold necessary for an actionable harassment case (including this case and this case). Nevertheless, it remains advisable for employers not to allow inappropriate behaviors in the workplace.

NLRB Issues 13 Complaints Against McDonald’s As A “Putative Joint Employer” With Its Franchisees

In December of 2014, the National Labor Relations Board (NLRB) Office of General Counsel moved forward with its efforts to hold McDonald’s USA, LLC vicariously liable as “a putative joint employer” with a number of its franchisees. The Office of General Counsel previously threatened this enforcement action in the summer of 2014.

The Office of General Counsel filed complaints against McDonald’s in 13 different regions. The complaints cover 78 separate charges of unfair labor practices including “allegations of discriminatory discipline, reductions in hours, discharges, and other coercive conduct directed at employees in response to union and protected concerted activities, including threats, surveillance, interrogations, promises of benefit, and overbroad restrictions on communicating with union representatives or with other employees about unions and the employees’ terms and conditions of employment.”

The inclusion of the franchisor, McDonald’s USA, LLC, as a “putative joint employer” is widely viewed as part of a broader effort by the Office of General Counsel to change the current joint employer standard under the National Labor Relations Act (NLRA). If successful, the application of the new joint employer standard – which focuses on whether “meaningful bargaining” can occur without the alleged joint employer – will likely raise the risk of vicarious liability under the NLRA for franchisors generally, not just McDonald’s.

In support of including McDonald’s USA, LLC as “putative joint employer” in each of the 13 complaints, the Office of General Counsel issued a “fact sheet” explaining that:

Our investigation found that McDonald’s, USA, LLC, through its franchise relationship and its use of tools, resources and technology, engages in sufficient control over its franchisees’ operations, beyond protection of the brand, to make it a putative joint employer with its franchisees, sharing liability for violations of our Act. This finding is further supported by McDonald’s, USA, LLC’s nationwide response to franchise employee activities while participating in fast food worker protests to improve their wages and working conditions.

Takeaway: The new McDonald’s cases are important test cases for the Office of General Counsel’s efforts to implement a new joint employer standard under the NLRA. Franchisors, in particular, should continue to monitor these cases to see whether the NLRB will adopt a new joint employer standard.

Top Ten Minnesota Employer Posts From 2014

To celebrate the end of year, here are the ten most popular posts published by MinnesotaEmployer.com in 2014:

  1. A Quick Guide To Equal Pay Certificates in Minnesota.
  2. Minnesota Minimum Wage Increase Becomes Law.
  3. Pregnancy Accommodations Under Minnesota Law.
  4. What Should Employers Know About Ebola?
  5. Breaking News: The Women’s Economic Security Act Is Poised To Become Law.
  6. New Wage Disclosure Protections Will Require Employee Handbook Updates.
  7. Can Managers Scream, Curse, and Act Like Jerks Towards Employees?
  8. What Employers Need to Know About Familial Status Discrimination.
  9. FLSA Companionship Services Exemption Will Narrow in 2015.
  10. Eleventh Circuit Holds that Employee’s Depression Does Not Qualify for FMLA Leave.

See you next year!

Minnesota Court of Appeals Triples The Statute of Limitations For Whistleblower Claims

The Minnesota Court of Appeals recently reversed a longstanding precedent and held that claims under the Minnesota Whistleblower Act, Minn. Stat. § 181.932, are governed by a six-year statute of limitations instead of a two-year statute of limitations.

In Ford v. Minneapolis Public Schools, the issue before the court was whether the Plaintiff’s whistleblower claim was barred by the two-year statute of limitations.  A13-1072 (Minn. Ct. App., Dec. 15, 2014).  The court held that the two-year statute of limitations did not apply, overturning a prior decision in Larson v. New Richland Care Ctr., 538 N.W.2d 915, 921 (Minn. Ct. App. 1995).

The Ford court reasoned that a whistleblower claim was not an “other tort resulting in personal injury” governed by the two-year statute of limitations in Minn. Stat. § 541.07(1), but instead was a “liability created by statute” governed by the six-year statute of limitations in Minn. Stat. § 541.05, subd. 1(2).  To reach this result, the Ford court relied on a recent Minnesota Supreme Court decision in Sipe v. STS Mfg., Inc., which held that “541.07(1) is limited to common law causes of action not created by statute.”  834 N.W.2d 683, 686 (Minn. 2013).  The Ford court explained that “[t]he supreme court’s decision in Sipe essentially overrules this court’s reasoning in Larson.”

Takeaway:  Unless appealed and overturned, the Ford decision means that plaintiffs now have six years to bring a claim for violation of the Minnesota Whistleblower Act instead of just two.  Combined with the Minnesota legislature’s recent expansion of the Whistleblower Act, this decision yet again increases the difficulty for employers to defend against whistleblower claims.

NLRB Holds That Employees Have A Presumptive Right To Use Employer-Provided Email For Union Organizing

Reversing a previous 2007 decision, the National Labor Relations Board (NLRB) recently held that employees have a presumptive right to use employer-provided email systems for union organizing and other protected, concerted activities.

In Purple Communications, Inc., the NLRB held that “[w]e adopt a presumption that employees who have been given access to the employer’s email system in the course of their work are entitled to use the system to engage in statutorily protected discussions about their terms and conditions of employment while on nonworking time, absent a showing by the employer of special circumstances that justify special restrictions.”  361 NLRB No. 126 (Dec. 11, 2014).  This includes the right under Section 7 of the National Labor Relations Act (NLRA) to engage in union organizing and other protected, concerted activities.  29 U.S.C. § 157.  The NLRB’s decision in Purple Communications reverses its prior decision on this subject in Register Guard, 351 NLRB 1110 (2007).

The NLRB explained its decision by stating that “email is the most pervasive form of communication in the business world,” and that “[s]ome personal use of employer email systems is common and, most often, is accepted by employers.”  The NLRB concluded that email has become a “natural gathering place” for employee-to-employee conversations and, therefore, should accommodate the exercise of Section 7 rights by employees.  The NLRB also decided to apply this new rule retroactively.

The NLRB’s new holding in Purple Communications has some important limitations, including the following:

  • Employers are not required to provide email to employees.
  • The rule only authorizes employees to send Section 7 communications during nonworking time, not during working time.
  • The rule only applies only to email, not other electronic communications systems that employers may provide.
  • The rule only applies to employee use of email. It does not authorize non-employees to access employer-provided email.
  • An employer may rebut the presumption that employees should be able to send Section 7 communications via employer-provided email by showing that “special circumstances make the presumption inappropriate in its workplace.” However, the NLRB cautions that “it will be the rare case where special circumstances justify a total ban on nonwork email use by employees.”
  • Short of a total ban on nonwork email use by employees, employers may still maintain “uniform and consistently enforced controls over their email systems to the extent that such controls are necessary to maintain production and discipline.” However, to justify a particular restriction, the employer must be able to “demonstrate the connection between the interest it asserts and the restriction.”
  • Employers may still “monitor their computers and email systems for legitimate management reasons, such as ensuring productivity and preventing email use for purposes of harassment or other activities that could give rise to employer liability.”

Takeaway:  Subject to certain limitations, employees now have a presumptive right to use employer-provided email during nonworking time to send communications related to union organizing or other concerted and protected activities under Section 7 of the NLRA.  However, the ruling leaves open a number of unanswered questions, such as what “special circumstances” might justify a total ban on nonwork email use.  This question, and others, will likely be answered through future NLRB litigation.

Do Employees Need To Be Paid For Post-Shift Security Screenings?

No – the U.S. Supreme Court recently held in a 9-0 decision that the Fair Labor Standards Act (FLSA) does not require employees to paid for post-shift security screenings because they are not “integral and indispensable” to the employee’s principal job activities.

In Integrity Staffing Solutions, Inc. v. Busk et al., the issue before the Court was whether the employer was required to pay warehouse employees for the approximately 25 minutes per day that they spent in security screenings following their shifts.  No. 13-433 (Dec. 9, 2014).  The employees’ primary job duties were to retrieve and package goods for delivery to customers of Amazon.com.  The screenings were implemented to prevent and detect employee theft.

The Court analyzed the issue under the Portal-to-Portal Act, which exempts employers from FLSA liability for claims based on “activities which are preliminary to or postliminary to” the performance of the employee’s “principal activities.”  29 U.S.C. § 254.  “Principal” activities are those activities that are an “integral and indispensable” part of the employee’s principal job duties.  The Court held that an activity is integral and indispensable “if it is an intrinsic element of those activities and one with which the employee cannot dispense if he is to perform his principal activities.”

The Court held that the security screenings were not “integral and indispensable” to the employee’s primary job duties of retrieving and packaging goods for delivery and, therefore, were postliminary activities that did not require payment under the Portal-to-Portal Act.  The Court reasoned that the employer “could have eliminated the screenings altogether without impairing the employees’ ability to complete their work.”

In reaching this conclusion, the Court specifically rejected the argument adopted by the Ninth Circuit Court of Appeals that the security screenings were compensable because the employer required them.  The Court explained that the integral and indispensable test under the Portal-to-Portal act focuses on the productive work the employee is employed to perform – not merely whether the activity is required.  If all required activities were covered, this would lead to the conclusion that activities expressly excluded by the Portal-to-Portal Act would be compensable, such as walking from a factory gate to the workstation.

Takeaway:  Under the Portal-to-Portal Act, preliminary and postliminary activities are only compensable under the FLSA if they are “integral and indispensable” to the employee’s principal activities.  To meet this standard, the preliminary or postliminary activity must be both “an intrinsic element” of the employee’s principal job duties and “one with which the employee cannot dispense if he is to perform his principal activities.”