In an employer-friendly decision, the Sixth Circuit Court of Appeals held that five comments about the size of a worker’s breasts over a 15-month period of time were not sufficiently severe or pervasive to constitute actionable sexual harassment. The Court concluded that the facts of the case were closer to ‘isolated incidents’ than to a ‘severe and pervasive’ work environment.

Facts

Nicole Massey worked as a security guard for Great Lakes Water Authority. In her annual performance review meeting, her supervisor allegedly commented that she “needed a more supportive bra.” On another occasion, a coworker allegedly commented that her “breasts were so big, it looked like [she] could trip over them.” In a third incident, her supervisor commented about Massey’s need to wear a bra under her uniform, which he explained was due to her decision to wear her bulletproof vest on top of (versus under) her uniform. There were two other lewd remarks allegedly made by coworkers. On summary judgment, the court presumes the facts in the light most favorable to the plaintiff-employee.

The comments were based on sex.

The Sixth Circuit held that the trial court erred in granting summary judgment on the basis that the comments were not “based on sex”–as the law requires. The Court held that, while comments about the size of a person’s breasts could be made to a man or a women, the comments were “based on sex” through the use of sex-specific and derogatory terms. The Sixth Circuit opined that the trial court overemphasized the fact that two of the alleged harassers were women.

The comments were not sufficiently ‘severe and pervasive.’

The Court, however, affirmed the grant of summary judgment to the employer, holding that the harassment was not severe and pervasive–another required element of a sex harassment claim. To be severe and pervasive, harassment must alter the working conditions of the victim’s employment and create an abusive work environment. Looking at the facts through the eyes of an objective person, the Court found the facts to be closer to “isolated incidents” than “severe and pervasive” harassment.

The Ohio Supreme Court declined to hear the appeal of an employee who challenged a provision in her employment contract that required that she bring all suits regarding her employment within six months following her termination. The employee alleged that, in light of the #metoo and #timesup movements, she should not be limited in the time frame to bring claims of sex discrimination and sex harassment as a matter of Ohio public policy. Six of seven justices declined to hear the case. For now, employers may continue to require employees to limit the timing for bringing employment-based claims, including those for sex harassment and discrimination.

The EEOC sent a letter to employer groups indicating that it would clarify the types and value of incentives that employers may offer to employees in order to encourage them to be vaccinated for COVID-19. The EEOC did not respond to the many employer groups’ requests with guidance or even a timetable for when guidance could be expected.

At present, vaccine incentives fall into a legal gray area. Employer wellness incentives are closely scrutinized and must be de minimus (e.g., a water bottle or t-shirt) in order to avoid violating the Americans with Disabilities Act. Many employers are offering the vaccination incentives to employees anyway and not waiting for guidance from the EEOC. Typical incentives range from: time off for vaccination, extra paid time off, and cash bonuses.

The American Rescue Plan Act of 2021 provides generous 100% COBRA coverage premium subsidies for employees and former employees who lose coverage due to a termination or reduction in hours. Employers provide the COBRA premiums for the employee, and employers are reimbursed through payroll tax credits. The administrative requirements of the law are complicated for employers and filled with landmines if an employer is not careful about compliance. Employers should begin identifying eligible individuals and prepare for the April 1, 2021 effective date.

Who qualifies?

First, the law applies to “assistance eligible individuals,” defined as: (1) employees and qualified beneficiaries who previously qualified for COBRA but did not elect; (2) employees and qualified beneficiaries who previously elected COBRA but allowed it to lapse; and (3) employees and qualified beneficiaries who lose coverage between April 1, 2021 and September 30, 2021. The loss of coverage must be due to an involuntary termination or reduction in hours. The loss in coverage may not be due to a voluntary event. However, it does not matter if the qualifying event was related to the COVID-19 pandemic.

Note: Employers with less than 20 employees covered by Ohio’s Mini-COBRA law still qualify for the subsidy.

What are the notice requirements?

Individuals in categories 1 and 2 must be provided notice of their qualification for the subsidy by May 31, 2021. They have 60 days from receipt of the notice to make or renew their COBRA election, for which coverage is retroactive to April 1, 2021. Individuals in categories 1 and 2 are those who lose coverage looking back between now and November 2019.

Assistance eligible individuals must be notified 15-45 days before September 30, 2021 that the subsidy will end.

The Department of Labor should issue model notices by April 10, 2021 for new elections and April 25, 2021 for the termination notices.

How long are individuals covered?

Coverage for assistance eligible individuals will begin on April 1, 2021, and end on September 1, 2021 (unless otherwise extended by a future Congressional Act) or when coverage would have ended under COBRA (usually 18 months from the qualifying event). A gap in coverage may occur before the April 1, 2021 effective date, and employees are not required to carry COBRA continuation coverage at their own expense during the gap period.

What if the individual gains other coverage?

The individual is required to notify the employer if he/she obtains other group health coverage or Medicare. The subsidy ceases at that point. Failure to provide this notice can result in a $250 penalty, or more for intentional violations.

Today, Congress passed the American Rescue Plan Act of 2021. Aside from the much publicized direct $1400 stimulus payments to individuals, there are business-related relief provisions of note to employers:

  • The $300 additional unemployment compensation weekly supplement will continue through September 6, 2021;
  • The Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation, covering independent contractors and self-employed individuals and extending state limits on benefits, will continue;
  • COBRA insurance continuation coverage will be free from April 1, 2021 through September 2021 for individuals laid off or facing reduced hours;
    • Eligible employees and dependents do not have to pay COBRA premiums;
    • Self-insured employers will be reimbursed through a credit against their payroll taxes;
    • For fully-insured plans, insurers will be reimbursed;
  • An additional $7 billion was injected into the Paycheck Protection Act loan program, which, unfortunately, will still end on March 31, 2021;
  • A new restaurant and hospitality industry specific fund of $24 billion was created to allow employers in those industries to pay payroll, mortgage, rent, utilities, and vendor expenses;
    • Employers may receive up to $5 million, or $10 million for multiple locations, based on the drop in revenue between 2020 and 2019;
  • The FFCRA employee retention credit was extended until December 31, 2021 to encourage businesses with a COVID-19 related closure or business interruption to retain employees; and
  • Employers who voluntarily continue to offer paid sick and family leave similar to that required by the FFCRA will be permitted tax credits equal to the amount of paid leave provided through September 30, 2021;
    • The mandatory paid leave ended on December 31, 2020 and has been voluntary since January 1, 2021;
    • The law adds additional covered reasons for FFCRA paid sick leave:
      • Time spent receiving a COVID-19 vaccination;
      • Time spent recovering from any injury, disability, illness, or condition related to COVID-19 vaccination; or
      • Time spent seeking or awaiting the results of a diagnostic test or medical diagnosis for COVID-19 (or the employer requested a test or diagnosis).
    • On April 1, 2021, employers who choose to extend FFCRA paid leave can re-set (1) the amount of available sick leave to 2 weeks (10 days) and (2) the amount of available family leave to an additional 10 weeks, to be used through September 30, 2021.

 

 

For years, Ohio had one of the most convoluted laws regarding age discrimination–providing no less than 4 different statutory paths to claiming age discrimination. In addition, Ohio permitted aggrieved employees to personally sue individual management employees for their actions because the law considered managers and supervisors to be within the definition of an “employer.” Finally, Ohio had one of the longest statutes of limitations of any state (at six years). That all changes on April 15, 2021 with the Employment Law Uniformity Act.

The changes made by the Employment Law Uniformity Act (HB 352) are as follows:

  • The Act requires–rather than making it optional–employees to file a charge of discrimination with the Ohio Civil Rights Commission (OCRC) before suing under state discrimination law.
    • Federal law already requires exhaustion of remedies with the Equal Employment Opportunity Commission (EEOC), or its state equivalent, before suing in court. This Act adds an exhaustion of administrative remedies requirement to state law claims.
    • Employees must obtain a “right to sue” letter from the OCRC before suing in court for discrimination or retaliation under Ohio law.
    • This part of the Act creates a new R.C. 4112.051 setting forth these administrative procedures before the OCRC.
  • The Act eliminates supervisor and manager personal liability for discrimination, unless the supervisor or manager acted outside the scope of his/her employment by: (a) retaliating against the employee who was opposing a discriminatory practice, (b) aiding a discriminatory practice, or (c) obstructing an investigation.
  • Ohio law now codifies the Faragher-Ellerth defense to harassment/hostile work environment claims, meaning that employers are not responsible for harassment/hostile work environment claims so long as:
    • The employer exercised reasonable care in preventing and/or correcting harassment (generally through a workplace harassment policy and complaint process); and
    • The complaining employee unreasonably failed to take advantage of those preventive and/or corrective opportunities (usually by failing to complain internally).
  • The Act shortens the statute of limitations for discrimination and retaliation claims to two years.
    • Previously, Ohio had a six-year statute of limitations for employment discrimination claims, one of the longest in any state. This required employers to retain employment records for six years after an employee’s termination.
    • However, this new two-year statute of limitations is tolled during the OCRC Charge process.
    • Employees have two years to file a charge of discrimination–rather than 180 days.
  • Ohio formally applied tort reform damages caps to employment discrimination claims.
    • These limits apply only to non-economic damages.
    • Economic damages are not limited.
    • Punitive damages caps also apply.
  • Finally, Ohio streamlined the options for pursuing age discrimination claims.

Ohio’s age discrimination statute provided for one of the most complex remedies schemes for age discrimination. There were four different statutory remedies with three paths to relief and different statutes of limitations (R.C. 4112.05, 4112.02(L), 4112.99, and 4112.14). Now, age discriminations under R.C. 4112.052 are aligned with other discrimination claims and have the same two-year statute of limitations. Age discrimination claims require exhaustion of administrative remedies with the OCRC. The Act left the door open to a narrow second option for age discrimination claims under R.C. 4112.14 where the employer fired an employee who is age 40 or older, who is otherwise qualified, without just cause and who cannot arbitrate the employment decision. Employees are limited to a claim under 4112.052 or the narrower 4112.14–not both.

Several employer groups jointly wrote to the EEOC at the beginning of the month asking the EEOC to clarify the extent to which employers may offer financial incentives to employees who take the COVID-19 vaccine without running afoul of the Americans with Disabilities Act (ADA).

Under the ADA, employee wellness programs must be truly “voluntary.” Employers cannot do anything related to a wellness program that would coerce an employee into providing disability-related information. In 2017, courts struck down regulations that allowed financial incentives, such as premium discounts, for wellness programs. Early this year, the EEOC proposed a rule to clarify that modest incentives, like water bottles and modest gift cards, would be permissible as wellness program incentives.

The EEOC said that the COVID-19 vaccine is not a “medical examination” under the ADA on its own; however, the prescreening questions before vaccination could elicit disability-related information, bringing the vaccine within the ADA’s protections.

The business groups urged the EEOC to treat the COVID-19 vaccine differently than wellness programs. Even without guidance from the EEOC, some employers, particularly those employing grocery store employees, have already announced incentives to employees who take the COVID-19 vaccine. Examples of employee incentives offered thus far: extra pay, time off work, free ride share rides, and cash incentives.

Washington, D.C., Mayor Muriel Bowser signed the Ban on Non-Compete Agreements Amendment Act of 2020 into law on Jan 11. Unless Congress acts, it will become law after 30 days and will be the most restrictive law governing non-compete agreements in the U.S.

By way of reference, California, Colorado, Illinois, Maryland, Massachusetts, Virginia, and Washington have restrictions on non-compete agreements between employees and private employers. This law is more broad than those states’ laws. The DC law is a blanket prohibition on non-compete agreements–both restrictions on simultaneous employment and post-termination employment. Non-compete agreements already in place on the date of enactment will remain enforceable. In addition, non-disclosure and confidentiality agreements will remain legal.

The new DC law permits private lawsuits and administrative complaints and provides for statutory damages and penalties, as well as back pay, liquidated damages, attorney fees, and costs.

 

Do employers have to report employee COVID-19 diagnoses, hospitalizations, and deaths?

The short answer, like many under the law, is maybe. Under 1904.39, employers must record and report the following to OSHA by calling or submitting a report online: a fatality (within 8 hours), in-patient hospitalization (within 24 hours), amputation (within 24 hours), or loss of an eye ( within 24 hours).

What if an employee is hospitalized due to COVID-19?

The incident is reportable only if the in-patient hospitalization occurs within 24 hours of a work-related exposure incident, and the employer “determines afterward that the cause of the in-patient hospitalization was a work-related case of COVID-19.”

What if an employee dies of COVID-19?

The answer is similar. The death must occur within 30 days of work-related exposure, and the employer “determines afterward that the cause of death was a work-related case of COVID-19.” The fatality must be reported within 8 hours of learning of the death and its link to a workplace exposure.

How do employers investigate causation?

It seems unlikely that an employer is going to be able to definitively trace causation to a work-related exposure, given the numerous possibilities for exposure and infection in the general public. Even OSHA recognizes that community spread and the contagious nature of COVID-19 make it difficult to investigate causation. OSHA expects employers to do the following and decide if work-related exposure was “more likely than not” a cause:

  1. Conduct a reasonable investigation.
    1. Ask the employee how he thinks he contracted COVID-19.
    2. Discuss the employee’s work and off-duty activities that may have led to exposure to COVID-19.
    3. Investigate potential exposure in the employee’s work area.
  2. Consider all evidence reasonably available to the employer, and consider new evidence that arises.
  3. An employee’s COVID-19 illness is likely work-related if:
    1. Several employees in the same area all contracted COVID-19 around the same time with no alternative explanation.
    2. It is contracted shortly after lengthy, close exposure to a particular customer or coworker who has a confirmed case of COVID-19 with no alternative explanation.
    3. The employee’s job duties include having frequent, close exposure to the general public in a locality with ongoing community transmission with no alternative explanation.
  4. An employee’s COVID-19 illness is likely not work-related if:
    1. The employee is the only worker to contract COVID-19 in his vicinity, and his job duties do not include having frequent contact with the general public, regardless of the rate of community spread.
    2. The employee, outside the workplace, closely and frequently associates with someone (e.g., a family member, significant other, or close friend) who (a) has COVID-19; (b) is not a coworker, and (c) exposes the employee during the period in which the individual is likely infectious.

On December 27, 2020, the Consolidated Appropriations Act, 2021, HR 133, the most recent COVID-19 relief and stimulus bill, was signed into law. The law extends some of the previously enacted relief provisions and ends others. The key provisions are summarized below.

COVID-19 paid sick and family leave – voluntary but eligible for an employer tax credit

  • The obligation (for employers with less than 500 employees) to pay employees for sick and family leave related to coronavirus ended on 12/31/20. The latest COVID-19 relief bill extends the tax credit for 3 additional months, until 3/31/21. Employers may voluntarily provide sick and family leave, as they did in 2020 under the Families First Coronavirus Relief Act (FFCRA), and receive a 100% payroll tax credit against their payroll taxes for the amounts paid.
  • These credits can only be claimed for employees who did not use their available 80 hours of sick and family leave and 10 weeks of additional family leave in 2020. The 2021 leave must qualify as sick and/or family leave under the FFCRA-defined criteria.

Unemployment benefits – extended eligibility and new $300 federal supplement

  • Employees on layoff or terminated received a federal supplemental unemployment payment of $600 until July 31, 2020. A new federal supplement will provide $300 per week until March 14, 2021.
  • Unemployed workers will be eligible for a federal extension of benefits of 24 weeks beyond state unemployment eligibility (an additional 11 weeks beyond that provided by the Coronavirus, Aid, Relief, and Economic Security Act (CARES Act)).
  • Gig economy workers, self-employed individuals, and independent contractors will be eligible for Pandemic Unemployment Assistance through March 14, 2021. Their CARES Act unemployment benefits previously expired on December 31, 2020.

Employee Retention Credit – extended through June 2021 and expanded to PPP recipients

  • Employee retention tax credits were extended, in an effort to prevent layoffs, through June 30, 2021.
  • Employers may deduct 70% of qualified wages (formerly 50% under the CARES Act), up to $10,000 per quarter (formerly $10,000 per year under the CARES Act).
    • This will result in a credit of up to $14,000 of qualified wages per employee in 2021.
  • Employers must have a 20% decline in gross receipts, comparing each quarter of 2021 to 2019. Thus, if Q1 and/or Q2 of 2021 have gross receipts of 80% or less, when compared to that same quarter of 2019, the employer is eligible. Employers also can qualify by being partially or fully shut down due to government orders; however, odds are that these employers will also have a 20% decline in gross receipts.
  • Employers receiving PPP loan funds may deduct payroll costs that were not paid with forgiven PPP loan funds. (This change is retroactive to March 2020).
  • Group healthcare expenses not included in an employee’s gross wages may be treated as qualifying wages for this tax credit.

Dependent care and healthcare FSAs – rollover can be permitted and mid-year elections allowed

  • Employers are permitted–but not required–to allow FSA dependent care participants to carryover unused funds from 2020 and 2021 and use them for an additional 12 months after the plan year ends.
  • Employers are permitted–but not required–to allow healthcare FSA participants who terminate participation (due to termination of employment or any other reason) to use the funds until the end of the plan year.
  • Employers that want to take advantage of these optional FSA extensions must amend their FSA plan documents.
  • Employees also  may make mid-year contribution changes in 2021.

Paycheck Protection Program (PPP) Loans – second round of funds, tax deductibility, and expanded uses

  • Businesses are eligible for a second round of PPP loan funds to be used for payroll and other specified business expenses.
  • The eligibility criteria is targeted at providing money to smaller small businesses:
    • The threshold number of employees for eligibility was reduced from 500 to 300 employees.
    • The maximum loan amount was reduced from $10 million to $2 million. The maximum loan amount for any business is 2.5 times the average monthly payroll costs in the year prior to the loan, up to $2 million.
    • Business must have at least a 25% reduction in gross revenues from any quarter of 2019 to the same quarter of 2020.
    • Business must have been in existence prior to February 15, 2020 and apply for second draw funds by March 31, 2021.
  • Loan forgiveness is available if the business spends at least 60% of the funds on payroll costs over a time period of its choosing of between 8 and 24 weeks.
  • The amounts forgiven under the PPP loan program are also tax deductible as business expenses, if they would otherwise qualify under the tax code.
  • The definition of eligible “other” (non-payroll) business expenses was expanded to include:
    • Worker protective equipment,
    • Supplier costs,
    • Costs of perishable goods,
    • Property damage due to public disturbances in 2020 that were not covered by insurance (e.g., damage caused by vandalism and looting ),
    • Technology operations expenses.
  • The prior list of other (non-payroll) eligible expenses included rent or lease payments, mortgage payments, and utilities. Those remain eligible business expenses for PPP loan forgiveness.

Student loan and educational expense tax exclusion – extended

  • The CARES Act allowed employers to pay employees up to $5,250 per year to assist employees with education expenses in 2020. The recent COVID-19 relief bill allows employers to pay up to $5,250 to each employee for the next five years (through 2025) for education expenses and student loan principal and interest repayment.