Our colleagues Patrick G. Brady and Julie Saker Schlegel, at Epstein Becker Green, have a post on the Retail Labor and Employment Law blog that will be of interest to many of our readers in the health care industry: “Beyond Joint Employment: Do Companies Aid and Abet Discrimination by Conducting Background Checks on Independent Contractors?

Following is an excerpt:

Ever since the National Labor Relations Board (“NLRB”) issued its August 2015 decision in Browning-Ferris Industries of California, Inc., holding two entities may be joint employers if one exercises either direct or indirect control over the terms and conditions of the other’s employees or reserves the right to do so, the concept of joint employment has generated increased interest from plaintiffs’ attorneys, and increased concern from employers. Questions raised by the New York Court of Appeals in a recent oral argument, however, indicate that employers who engage another company’s workers on an independent contractor basis would be wise to guard against another potential form of liability, for aiding and abetting acts that violate various anti-discrimination statutes, including both the New York State (“NYSHRL”) and New York City Human Rights Laws (“NYCHRL”) and the New Jersey Law Against Discrimination (“NJLAD”).

Read the full post here.

On February 15, 2017, Mayor Muriel Bowser signed the “Fair Credit in Employment Amendment Act of 2016” (“Act”) (D.C. Act A21-0673) previously passed by the D.C. Council. The Act amends the Human Rights Act of 1977 to add “credit information” as a trait protected from discrimination and makes it a discriminatory practice for most employers to directly or indirectly require, request, suggest, or cause an employee (prospective or current) to submit credit information, or use, accept, refer to, or inquire into an employee’s credit information. As discussed in our earlier advisory, the Act will take effect following a 30-day period of congressional review per the District of Columbia Home Rule Act, and publication in the D.C. Register, and shall apply upon inclusion of its fiscal effect in an approved budget and financial plan. The latter may not occur until this summer

In a notable recent court decision highlighting transgender issues and employer sponsored benefit plans, on January 13, 2017, in Baker v. Aetna Life Ins. Co., 2017 U.S. Dist. LEXIS 5665, 2017 WL 131658 (N.D. Tex.), Aetna Life Insurance Co. (“Aetna”) defeated a claim by a transgender employee of L-3 Communications Integrated Systems LP (“L-3”) who alleged that Aetna’s denial of her disability benefits constituted discrimination based on her gender identity. The plaintiff, Charlize Marie Baker (“Baker”), is a participant in L-3’s Employee Retirement Income Security Act (“ERISA”) covered group health plan and short term disability benefits plan (“STD Plan”). Aetna is the third party administrator (“TPA”) of the group health plan and the claim fiduciary and administrator of the STD Plan.

In 2011, Baker began transitioning from male to female, legally changing her name and gender designation on all government issued documents. In 2015, after a consultation with a health care professional who determined that breast implants were medically necessary to treat gender dysphoria, Baker scheduled surgery and sought benefits under the STD Plan to cover her post-surgery recovery. Coverage under the group health plan and benefit claims under the STD Plan were denied. Filing suit against Aetna and L-3, Baker alleged that Aetna and L-3 discriminated against her based on her gender identity in violation of Section 1557 of the Affordable Care Act (the “ACA”), that Aetna denied her benefits under the STD Plan in violation of ERISA, and that Aetna and L-3 violated Title VII by discriminating against her based on her sex.

The court held that there is no controlling precedent that recognizes a cause of action under Section 1557 for discrimination based on gender identity with Baker failing to cite any precedent that recognizes such a cause of action. The court also held that ERISA does not recognize such a claim. Specifically, the court concluded that it is up to Congress to decide whether it wants to create in ERISA a protection that the statute does not expressly provide. Lastly, regarding Baker’s Title VII claims, the court found that Aetna was not an employer of Baker under the “single employer” test or the “hybrid economic realities/common law control” test. However, the court declined to dismiss Baker’s Title VII claims against L-3, finding Baker did sufficiently argue that she was denied employee benefits due to her sex.

Takeaways

While the Northern District of Texas declined to find a cause of action for gender identity discrimination under Section 1557 of the ACA, there are several cases of gender identity or transgender discrimination pending that may further impact the law for these benefit claims under Section 1557. There is little likelihood, however, that a claim of gender identity discrimination will be successful under ERISA. If the ACA is repealed under the Trump administration, Section 1557 will no longer be available and transgendered employees would be limited to claims under Title VII, to the extent that employees are successful in arguing that discrimination on the basis of gender identity constitutes sex discrimination.

Kyler Prescott was a 14 year old transgender boy who was receiving puberty-delaying medication to help him transition.  Shortly before Kyler’s death he had “suicidal ideation” and was taken to Rady Children’s Hospital – San Diego in April 2015.  The hospital has a Gender Management Clinic to provide services to children with gender dysphoria and related issues.  A lawsuit under the ACA’s non-discrimination provision, § 1557, alleges that after admission, despite assurances that he would be referred to with masculine pronouns, hospital employees referred to Kyler as a girl.  The suit claims that the hospital’s actions discriminated against Prescott “resulting in his inability to access necessary services and treatment during a dire medical crisis.” The federal lawsuit, filed in the Southern District of California, further alleges that the use of female references exacerbated his condition and that he thereafter had further difficulties and ultimately committed suicide.

As discussed in our recent October 6, 2016 webinar and in our Client Advisory, HHS’s Office of Civil Rights (“OCR”) final § 1557 regulations explicitly include coverage for gender identity and sexual stereotypes.  They also state that covered entities must “treat individuals consistent with their gender identity . . . .” 45 C.F.R. § 92.206.  This lawsuit appears to be one of the first under § 1557 for gender identity discrimination.  It will surely not be the last.

The suit focuses on claims that nurses and other staff repeatedly used feminine pronouns in referring to Kyler despite assertions in the court pleadings of multiple calls by his mother to the hospital to explain his distress at this alleged conduct.  Hospital staff failed to use Kyler’s preferred pronouns despite hospital records showing Kyler’s legal name and gender change from female to male, according to the suit.

The results of the lawsuit, which at this time are only unproven allegations, will await further court proceedings. What the suit clearly shows, however, is that compliance with § 1557’s notice and policy requirements, effective October 16, was only the beginning of § 1557 compliance needs for covered health care entities.  Among the necessary next steps in compliance with which we are assisting clients are developing appropriate training of all staff interacting with patients and companions on the requirements of § 1557 in providing services, proper categorization of gender in health care records and in-patient references, as well as the need for training and visibility on provider non-discrimination and grievance policies.  This lawsuit dramatically emphasizes the urgency for continuing efforts to achieve full compliance with § 1557 and the OCR final regulations to avoid § 1557 discrimination claims on the expansive grounds covered by § 1557 as interpreted in OCR’s final regulations.

In employment litigation, plaintiffs often rely on the “cat’s paw” doctrine to hold their employers liable for discriminatory or retaliatory animus of a supervisory employee who influenced, but did not make, the ultimate employment decision.  On August 29, 2016, the United States Court of Appeals for the Second Circuit, in Vasquez v. Empress Ambulance Service, Inc., greatly extended the reach of the “cat’s paw,” holding that the doctrine could be applied to hold an employer liable for an adverse employment decision that was influenced by the discriminatory or retaliatory animus of a low-level, non-supervisory co-worker.

The plaintiff, an emergency medical technician employed by the defendant, was terminated within hours of complaining to her supervisors that a male co-worker had sent her a text message containing a graphic, sexual photograph.  Plaintiff alleged that when her male co-worker learned that she had complained, he manipulated his iPhone to make it appear that a conversation containing consensual sexual text banter that he had with another person was a conversation between him and plaintiff and, when questioned by the employer about plaintiff’s allegations, provided printed screen shots of portions of this alleged conversation, telling the employer that he and the plaintiff had been involved in a consensual relationship.  In her lawsuit, plaintiff complained that her employer accepted the co-worker’s tale as true, and rejected her offer to turn over her cell phone for inspection or otherwise refute his claim.  Instead, plaintiff asserted that she was told by her employer that it “kn[e]w the truth,” that she had a sexual relationship with the co-worker, and that her employment was being terminated because she had sexually harassed him.   Plaintiff filed suit, asserting that the employer’s decision to terminate her employment was an act of retaliation in violation of Title VII because she had voiced complaints of sexual harassment.  Relying on the “cat’s paw” doctrine, the plaintiff argued that the employer’s decision to terminate her employment was influenced by false information provided by her male co-worker.  The district court dismissed her complaint, concluding that an employer could not be held liable under the “cat’s paw” doctrine for the discriminatory or retaliatory intent of a non-supervisory co-worker.

On appeal, the Second Circuit disagreed and reinstated plaintiff’s Complaint.  Despite the fact that the male co-worker was a low-level employee without any supervisor authority, the Second Circuit held that the employer’s “own negligence provides an independent basis” to treat the male co-worker as its agent and hold it accountable for his illegitimate intent.  Referencing the allegations that the employer “blindly credited” the male co-worker’s assertions and “obstinately refus[ed] to inspect [plaintiff]’s phone or to review any other evidence proffered by [plaintiff] in refutation,”   the Second Circuit concluded that “an employer may be held liable for an employee’s animus under a ‘cat’s paw’ theory, regardless of the employee’s role within the organization, if the employer’s own negligence gives effect to the employee’s animus and causes the victim to suffer an adverse employment action.”

The impact of this decision on health care employers who are often called upon to make employment decisions based on information provided by one employee about another?  Negligence is the key.  Only when the employer effectively adopts the co-worker’s animus by acting negligently with regards to the information provided may the co-worker’s improper motivation be imputed to the employer to support a claim under the cat’s paw doctrine.  Exercise good faith and be thorough in conducting internal investigations.  Do not ignore warning signs.  Consider all evidence offered in making employment decisions.

Our colleague Linda B. Celauro, Senior Counsel at Epstein Becker Green, has a post on the Financial Services Employment Law blog that will be of interest to many of our readers in the health care industry: “Seventh Circuit Panel Finds That Title VII Does Not Cover Sexual Orientation Bias.

Following is an excerpt:

Bound by precedent, on July 28, 2016, a panel of the U.S. Court of Appeals for the Seventh Circuit held that sexual orientation discrimination is not sex discrimination under Title VII of the Civil Rights Act of 1964. The panel thereby affirmed the decision of the U.S. District Court for the Northern District of Indiana dismissing the claim of Kimberly Hively, a part-time adjunct professor at Ivy Tech Community College, that she was denied the opportunity for full-time employment on the basis of her sexual orientation.

The importance of the Seventh Circuit panel’s opinion is not in its precise holding but both (i) the in-depth discussion of Seventh Circuit precedence binding it, the decisions of all of the U.S. Courts of Appeals (except the Eleventh Circuit) that have held similarly, and Congress’s repeated rejection of legislation that would have extended Title VII’s protections to sexual orientation, and (ii) the multifaceted bases for its entreaties to the U.S. Supreme Court and the Congress to extend Title VII’s prohibition against sex discrimination to sexual orientation discrimination.

The Seventh Circuit panel highlighted the following reasons as to why the Supreme Court or Congress must consider extending Title VII’s protections to sexual orientation …

Read the full post here.

The District of Columbia Office of Human Rights recently partnered with the National LGBTQ Task Force to publish a resource guide, “Valuing Transgender Applicants & Employees: A Best Practices Guide for Employers” (the “Guide”), designed to support employers in creating workplace and hiring policies that prevent discrimination against transgender and gender-nonconforming individuals. The guide is meant to lay the framework for building a culture of inclusion in the workplace that goes beyond legal obligations.

The suggested best practices include ensuring managers and coworkers use the names and pronouns preferred by transgender employees, maintaining the confidentiality of employees’ gender identity, implementing gender-neutral dress codes, providing access to restroom facilities corresponding to employees’ gender identity, and building an environment in which harassment or off-color comments are not tolerated.

The Guide emphasizes communication between employers and their transgender or gender-nonconforming employees and applicants so that the employer may understand what transgender employees believe a safe and inclusive workplace should look like and respond accordingly.  Recognizing that each individual has different needs, employers are encouraged to work with transitioning employees to develop a plan for them to transition in the workplace.  That said, transgender employees are not expected to shoulder the responsibility of educating coworkers or of ensuring their comfort.  Particularly because DC law prohibits discrimination based on gender identity or expression, employers should establish clear rules requiring professional demeanor, prohibiting transphobic and other harassing behavior, and prompting quick responses to any violations.

Following DC regulations, the Guide also instructs employers to provide access to restrooms and other gender-specific facilities consistent with employees’ gender identity or expression. Consistent with guidance from the EEOC and OSHA, transgender employees should never be required to use a separate gender-neutral facility – even if a cisgender employee expresses discomfort about sharing a gendered facility with a transgendered coworker.  In that case, the cisgender employee should be offered the use of a separate facility.

While the Guide has particular applicability for employers that operate in the District of Columbia, all employers should take note, as the recommended best practices are consistent with the way federal agencies are interpreting and enforcing federal law.

Our colleague Frank C. Morris, Jr., attorney at Epstein Becker Green, has a post on the Financial Services Employment Law blog that will be of interest to many of our readers in the health care industry: “New Online Recruiting Accessibility Tool Could Help Forestall ADA Claims by Applicants With Disabilities.”

Following is an excerpt:

In recent years, employers have increasingly turned to web based recruiting technologies and online applications. For some potential job applicants, including individuals with disabilities, such as those who are blind or have low vision, online technologies for seeking positions can prove problematic. For example, some recruiting technologies and web-based job applications may not work for individuals with disabilities who use screen readers to access information on the web. The U.S. Department of Labor’s Office of Disability Employment Policy (ODEP) recently announced the launch of “TalentWorks.”

Read the full post here.

Our colleagues Peter M. Panken, Nancy L. Gunzenhauser, and Marc-Joseph Gansah have a post on the Retail Labor and Employment Blog that will be of interest to many of our readers in the health care industry: “Employers Should Care About This: New York City’s Amendment on Caregiver Discrimination.”

Following is an excerpt:

The New York City’s Human Rights law (“NYCHRL”) prohibits employment discrimination against specified protected classes of employees and applicants including:

race, color, creed, age, national origin, alienage or citizenship status, gender, sexual orientation, disability, marital status, partnership status, any lawful source of income, status as a victim of domestic violence or status as a victim of sex offenses or stalking, whether children are, may be or would be residing with a person or conviction or arrest record.

If this list wasn’t long enough, on May 4, 2016, NYCHRL will add “caregivers” to the protected classes including, anyone who provides ongoing medical  or “daily living” care for a minor, any disabled relative or disabled non-relative who lives in the caregiver’s household. …

Read the full post here.

Our colleague Nancy L. Gunzenhauser, an Associate at Epstein Becker Green, has a post on the Retail Labor and Employment Blog that will be of interest to many of our readers in the health industry: “Reminder: All Philadelphia Employers Must Post New Ban-the-Box Poster.”

Following is an excerpt:

One of the requirements of the amended Philadelphia ban-the-box law has gone into effect. As of March 14, 2016, Philadelphia employers are required to post a new poster provided by the Philadelphia Commission on Human Relations in a conspicuous place on both the employer’s website and on premises, where applicants and employees will be most likely to notice and read it. …

Read the full post here.