Philip Brooks

Monday, 22 July 2002 10:02

Employer-friendly ADA

Disability discrimination claims against employers have grown dramatically since the Americans with Disabilities Act went into effect six years ago. Over the last three years, more disability discrimination claims were filed with the Equal Employment Opportunity Commission than any other type of claim-amounting to just under one-quarter of all claims filed. So employers need to be better prepared than ever before to handle the intricacies of this law.

But the good news is that the courts haven't forgotten the employer's rights in discrimination matters.

Certainly, the ADA requires employers to reasonably accommodate a particular applicant's or employee's known disabilities to the specific duties of a particular job under certain circumstances, and to not inquire about unknown disabilities or use stereotypes regarding medical conditions. As such, though, employers understandably have been concerned that such a legal standard invites lawsuits against them.

After all, employers have long feared employment discrimination claims in other areas, such as age, sex, race, national origin and religious discrimination. Unclear and open-ended legal rules in these areas permit inconsistencies and inferences to be exploited against employers.

However, while numerous pitfalls exist which should be avoided in handling disabled-employee matters, the good news is that the courts have recognized and supported employer rights. Rulings against employers have generally been limited-much more so than in other areas of employment discrimination law. Managers who are thoughtful and take reasonable steps to investigate and handle employee disability cases face a low risk of liability.

Courts in many cases have dismissed claims by people whose physical or mental impairments are not substantial. If an individual is able to conduct most basic daily activities (eating, reading, talking, dressing, walking, working in various jobs) despite an impairment, then generally his condition is not considered serious enough to qualify for protection from disability discrimination (unless the impairment is degenerative and will likely produce serious consequences over time). This is an important check against employees misusing this law to get favoritism and an easier job as a result of a mild impairment. This law is reserved for people who truly suffer from serious physical and mental impairments.

Courts also have generally rejected claims from employees who did not request an accommodation and for whom the need for an accommodation was not obvious. In other words, courts have held that, generally, the employee is responsible for raising the issue of the need for an accommodation with his employer.

Keep in mind, the employer is not obligated to question whether, or suggest that, an employee needs an accommodation, unless it's obvious the employee's condition warrants accommodation to enable him to productively perform his job. This is helpful to protect employers from claims by individuals who did not divulge any disability or a need for accommodation until after a discharge or other negative job action.

Similarly, courts are not permitting employees to dictate what specific accommodation must be utilized when various alternatives are available. Employers are free to select any reasonable accommodation-not necessarily the accommodation preferred or considered most reasonable by the employee.

This is also a valuable tool for employers to avoid the situation in which an employee with a substantial impairment seeks to get out of an undesirable duty, not just because of the impairment, but because he doesn't like that activity or work location. The focus is, and has remained on, what accommodation will permit the core job duties to be properly performed, rather than completely removing managerial prerogatives.

Employers are not required to accept whatever an employee's doctor recommends. An employer, under reasonable circumstances in which doubt arises concerning a medical statement, is able to question an employee's doctor and get a second opinion from a physician of the employer's choice. It's not uncommon for employers to come across a few physicians who give a patient whatever work-restriction note he wants. The right of employers to seek further information is helpful in combating unjustified restrictions.

Moreover, employers are not required to remove essential job elements to accommodate a disabled individual. If the employer has engaged in a genuine effort to identify any reasonable accommodations that will enable an individual to competently perform a particular job and can't find such an accommodation, then the employer isn't required to eliminate the job function at issue unless it's a marginal and unimportant aspect of the job.

Finally, courts have rather uniformly respected the job rights and procedures applicable to other employees in the workforce. Court decisions repeatedly hold that disability accommodation obligations do not trump seniority and other procedures applicable to nondisabled employees. An employer, for instance, isn't required to move an employee off a job simply to create an opening for a disabled employee unable to do his own job with accommodation. However, a disabled employee unable to perform his regular job should be considered for vacancies for which candidates are being sought.

Disability discrimination law is complicated. But if employers obtain good counsel in handling disability issues when they arise, the risk of being on the losing end of a discrimination suit is low. Generally, the steps to be taken include doing an appropriate investigation, including getting information from physicians as well as the employee; avoiding stereotypes regarding medical conditions; focusing on the key needs of the job; keeping an open mind regarding accommodations; and reacting to further developments in the employee's condition. Employers who obtain good guidance can be successful in accommodating employees with legitimate needs without having to fear liability from standing up to those employees not so deserving.

Craig M. Brooks is a shareholder practicing employment law with Pittsburgh-based law firm Houston Harbaugh, PC. Questions about this and other employment-law issues can be directed to Houston Harbaugh at (412)281-5060.

The laws providing for overtime pay and minimum wages have been around for more than 60 years. However, the rules on this subject are frequently misunderstood and overlooked.

The problems are because of a lack of publicity concerning the legal requirements as well as the fact that this is an anachronistic and inflexible area of the law.

Misconceptions abound regarding overtime and other pay practices.

Take the following, for instance: It is up to the employer to determine who receives overtime pay; comp. time (time off in another week to make for overtime work) is OK; all paid time must be counted toward overtime; all individuals on-call must be paid for their time; an employee is not entitled to overtime pay unless his or her extra hours were scheduled and approved in advance by the supervisor. Of course, all of these are inaccurate.

Increasing awareness by employees (particularly disgruntled ex-employees) and aggressive enforcement by the U.S. Department of Labor's Wage and Hour Division have increased the number of claims. Whenever the Department of Labor receives a complaint or conducts a random investigation, it reviews an employer's pay practices for all of its workers, not just those of the one complaining.

The penalties assessed by the Department of Labor or through an employee lawsuit can include: overtime and back pay for two or three years, which may be doubled; extra "civil money penalties" for being a repeat violator; and payment of the employee's attorneys' fees.

A key area in which claims often arise is whether particular employees can legally be excluded or exempted from overtime pay. The regulations describing the main exemption categories-executive, administrative, professional (with special rules for computer programmers) and outside salespeople-are often misunderstood and difficult to apply.

The executive exemption applies generally to people whose primary duty is management and who supervise at least two employees. The professional category covers people performing work truly of the nature of a well-recognized profession that requires specialized education, such as doctors, engineers, accountants, attorneys, registered nurses and others.

The administrative exemption is very complicated and poorly defined, covering employees doing nonmanual work directly related to key management policies and business operations in which the employee regularly uses independent judgment and discretion (a buyer, personnel or safety director, executive assistant, credit manager or other).

To treat an employee as exempt from overtime pay, not only must the employee's duties fall into one of the exemption categories, but also the employee must be paid on a salary, not hourly, basis. With few exceptions, this means the employees are to be given their full salaries for any week in which they perform any work, regardless of whether they actually worked more or less than 40 hours.

Deductions for partial-day absences or partial-week disciplinary suspensions are prohibited for exempt employees, except suspensions for serious safety infractions. Employee handbooks should be revised to remove disciplinary rules that call for such unpaid suspensions for exempt employees (use a final-warning letter in lieu of a suspension).

Deductions for leave under the Family and Medical Leave Act, as well as full-day absences after exhaustion of bona fide vacation- or sick-leave benefits, may be permitted in compliance with the applicable regulations.

Most employees are entitled to overtime pay, but a number of other options often are overlooked-options that prove less expensive than the common time-and-a-half overtime rate. While most employers know to pay at least the current minimum wage, $5.15 an hour, many often seem confused over what time they must pay for and count toward overtime for their employees.

Generally, any time that an employer "suffers or permits" an employee to work is paid time that must be counted toward overtime. Even if the employer did not schedule an employee to work overtime but was aware that the employee came in early, worked late, worked through the given work breaks and even worked at home, then the employer will be liable for extra pay, likely at overtime rates, for this time.

Therefore, employers must police the work times of their hourly paid employees. Both rules in an employee handbook or other policy statement governing working extra hours and day-to-day oversight are needed. While many employees are unaware of their right to overtime pay for this time or would consider it unprofessional to make such a claim, it only takes one disgruntled employee or former employee to start a Department of Labor investigation of all of your employees. Unfortunately, the ranks of disgruntled former employees are growing.

Indeed, issues concerning pay are a central concern to every employee, so questions and challenges from employees may arise. Employers, therefore, should review their practices and get advice on preventing problems. The penalties built into the law, such as attorneys' fees to the winning employee (but not to the winning employer) exact a greater toll on employers who wait. SBN

Craig M. Brooks is a shareholder practicing employment law with Houston Harbaugh, PC, in Pittsburgh. Questions about this and other wage and hour topics can be directed to Houston Harbaugh at (412) 281-5060.

Monday, 22 July 2002 09:51

Applying the obvious

It has been said that one of the big differences between the nonachiever and the achiever is that the latter has mastered the art of applying the obvious. When applying this in looking for trouble in your own business or in others, owners are forced to ponder, “What exactly is the obvious?”

Business people have been caught by surprise by the sight of once-untoppable corporations, such as the Pittsburgh Penguins and AHERF, that stood like immovable redwoods, truncated to bankruptcy by warning signs gone unnoticed (at least by some observers). If large corporations can’t see the forest for the trees, what chance do smaller-business owners have in recognizing trouble before it’s too late?

That all depends on how you apply the obvious, armed with information directly from the Turnaround Management Association’s report, “Signs of a Troubled Business.”

Let’s say you’re in the business of selling donuts. Are you experiencing market lag? Have marketplace changes left your sales lost in a cloud of smoke because of obsolete equipment or failure to keep pace with market needs? Does the donut shop across town offer customers the chance to order its donuts on the Web and have them delivered?

Meanwhile, you’re trying to decide whether to try that neat spider design for your Halloween donut special. If you’re managing this donut company without adequate reporting mechanisms, you face a lack of operating controls, which forces your management to make decisions on stale or inaccurate information that can lead your company in the wrong direction. Also, overdiversification may cause you to spread your business too thin, leaving it to be eaten up by competitors.

Still, who wouldn’t like explosive growth? Often, such growth carries a very high price tag. And leveraging a company to such a degree means you must operate with little or no margin for error.

Business decisions based on emotional issues such as divorce, death or nepotism likewise can lead to a sticky dilemma that pits family against business matters. A recent survey conducted locally by the Family Enterprise Center at the University of Pittsburgh in conjunction with the Steel Valley Authority found that more than 56 percent of jobs in our manufacturing sector are in a precarious position, as they are in family-controlled companies with owners over 45 years of age who have no plans for succession in place.

Deciding which relatives or their offspring should run the business after retirement or death can be one of the most difficult challenges a privately held business owner can face. If you operate without a written business plan, goals may be half-baked and left open to dangerous individual interpretation.

Moreover, ineffective management style could include a founder who is unyielding and allows no decision to be made without his or her blessing.

Then there’s your customer base. Putting all your proverbial eggs in one basket will result in a precarious customer base. If only two of your customers represent 60 percent of the business, you’re obviously vulnerable.

Be sure you’re not overrunning your employee capacity. If your donut business was a sweet success at $5 million a year, it may get dunked at $10 million a year. Managing operations with two stores is much different than managing them for a dozen locations and may require training of your existing work force or additions/replacements of key staff.

Then there’s your relationship with your lenders. Building poor lender relationships will leave a bad taste in your mouth. Fearing that your loan or loans may be in jeopardy, you may attempt to hide financial data from your bank and avoid phone calls. Don’t sugarcoat financial data or withhold key information.

Now that you have a taste of what warning signs to look for, take some time, sit back and analyze your business because, with a good recipe for success, the rest is just icing on the ... donut.

Philip Brooks, a management consultant for nearly 17 years, provides interim management services. He is the immediate past president of the Pittsburgh chapter of the Turnaround Management Association. Reach him at (724) 934-4829 or via e-mail at brooks@michaeljames.com.


For turnaround management help ...

For business owners lacking the expertise of a skilled consultant, merely breaking the surface of this deep quagmire can be a dirty job. For those in search of consultants to help make the job easier, Turnaround Management Association (TMA) offers the leading international association of professionals who assist businesses to manage periods of dramatic change and improve business performance. See www.turnaround.org for more information on the organization and www.turnaroundpgh.org for local chapter events.