The United States is in the midst of an unusually lethal flu season, and health experts agree that despite inconsistencies in their effectiveness, flu shots are among the best ways to fight the spread of the flu. A recent holding from the Third Circuit Court of Appeals provides some good news for health care employers who require that their patient-facing employees receive flu shots, making it more difficult for employees to claim a religious exemption.

Courts have held that health care employers may require their patient-facing employees to be vaccinated against a number of diseases, including the flu.  Whether employers can mandate vaccinations for all employees has been a closer question.  A key issue faced by employers is determining whether an employee’s anti-vaccination beliefs qualify for a religious exemption.

In Fallon v. Mercy Catholic Medical Center, the Third Circuit considered the religious exemption, clarifying what may qualify as such. Paul Fallon, a psychiatric crisis intake employee of Mercy Catholic Medical Center (“Mercy”), refused to get his required annual flu shot. Fallon had successfully asserted a religious exemption for several years before Mercy changed its policy to require that employees seeking such exemptions provide a note from a clergy member. Fallon, who does not belong to a religious organization, did not provide the clergy note, instead outlining his “sincerely held beliefs” opposing the vaccine in a 22-page essay. Mercy determined that Fallon’s beliefs, however sincere, were not religious. It did not grant the exemption, and subsequently fired Fallon when he continued to refuse vaccination. Fallon sued Mercy for wrongful termination alleging religious discrimination and a failure to accommodate in violation of Title VII of the Civil Rights Act of 1964.

The District Court sided with Mercy, and the Third Circuit affirmed the decision. The court relied on the three-part modern definition of religion, as adopted in Africa v. Commonwealth of Pennsylvania, 662 F.2d 1025, 1032 (3d Cir. 1981): a religion (1) addresses fundamental and ultimate questions having to do with deep and imponderable matters; (2) is comprehensive in nature, consisting of a belief system as opposed to an isolated teaching; and (3) is often recognized by the presence of certain formal and external signs.  The court concluded that Fallon’s belief that “the flu vaccine may do more harm than good” amounted to nothing more than a concern about the health effects of the vaccine and demonstrated his disbelief of the scientifically accepted view that it is harmless to most people.  Therefore, Fallon could not meet either of the first two prongs of the Africa test.  In addition, Fallon was unable to meet the third pong because he could not demonstrate that his beliefs manifested in “formal and external signs,” such as services or the existence of clergy.    Accordingly, the court concluded that Fallon’s “beliefs do not occupy a place in his life similar to that occupied by a more traditional faith,” meaning that “[h]is objection to vaccination is . . . not religious and not protected by Title VII.”

While the court’s decision provides guidance for employers responding to anti-vaccination beliefs, the court recognized that anti-vaccination beliefs can be part of “a broader religious faith.”  Thus, employers should be mindful not to categorically deny all requests for religious exemptions based on anti-vaccination beliefs.

Employers also should follow the recent developments within the Department of Health and Human Services (HHS), which recently established a new Conscience and Religious Freedom Division in the Office for Civil Rights (OCR) and released a proposed rule that would provide protections for health care workers who refuse to participate in services that run counter to their religious beliefs or moral convictions.   In an HHS press release on January 19, 2018, Acting HHS Secretary Eric D. Hargan said that the creation of the Division constitutes “a rollback of policies that had prevented many Americans from practicing their profession and following their conscience at the same time,” adding that “Americans of faith should feel at home in our health system, not discriminated against.”  These developments, and the public comments by HHS officials, may signal a move to prevent employers from enforcing mandatory flu vaccination policies.

On January 11, New York’s City Council passed Int. No. 1186-A, which amends the New York City Human Rights Law to expand the definition of the terms “sexual orientation” and “gender.”  Previously, the law defined sexual orientation as meaning “heterosexuality, homosexuality, or bisexuality.” The new definition takes a broader view and offers a more nuanced definition that recognizes a spectrum of sexual orientations, including asexuality and pansexuality.  As amended, the law defines sexual orientation as:

[A]n individual’s actual or perceived romantic, physical or sexual attraction to other persons, or lack thereof, on the basis of gender. A continuum of sexual orientation exists and includes, but is not limited to, heterosexuality, homosexuality, bisexuality, asexuality, and pansexuality.

The law also offers clarity on the definition of “gender,” and continues to include a person’s gender-related self-image, appearance, behavior, expression, or other gender-related characteristic within its scope.

The new law will take effect on May 11, 2018.

Further emphasizing the split in authority on sexual orientation discrimination, last month the Eastern District of Missouri dismissed plaintiff Mark Horton’s claim that Midwest Geriatric Management LLC (“MGM”) violated Title VII by rescinding an offer of employment after learning that he is gay. Horton v. Midwest Geriatric Mgmt., LLC, Case No. 4:17CV2324, 2017 U.S. Dist. LEXIS 209996 (E.D. Mo. Dec. 21, 2017).

Horton asserted that MGM unlawfully discriminated against him on the basis of sex and religion. Horton’s sex discrimination claim comprised three theories: (1) sexual orientation is necessarily discrimination based on sex; (2) discrimination on the basis of his association with a person of a particular sex (his male partner); and (3) nonconformity with sex stereotypes.  In granting MGM’s motion to dismiss, the district court cited Eighth Circuit precedent from a 1989 holding that Title VII does not cover discrimination based on sexual orientation, and concluded that both the sex and religious discrimination claims were merely refashioned sexual orientation discrimination claims.

The Eighth Circuit precedent, which comports with a recent decision in the Eleventh Circuit, contrasts with the EEOC’s position, adopted by the neighboring Seventh Circuit in Hively v. Ivy Tech Community College. In that case, the Seventh Circuit held that “a person who alleges that [he] experienced employment discrimination on the basis of [his] sexual orientation has put forth a case of sex discrimination for Title VII purposes.” Hively v. Ivy Tech Cmt. College, 853 F.3d 339, 351-52 (7th Cir. 2017). The Hively court based its holding on a conclusion that there is no difference between a gender nonconformity claim and one based on sexual orientation. Thus, “a policy that discriminates on the basis of sexual orientation . . . is based on assumptions about the proper behavior for someone of a given sex.” Id. at 346. The Court further cited a “common-sense reality that it is actually impossible to discriminate on the basis of sexual orientation without discriminating on the basis of sex.” Id. at 351.  While the Seventh Circuit is the first federal appellate court to find sexual orientation covered by Title VII, the Second Circuit is considering the question in en banc review.

Unlike the Seventh Circuit’s approach, the Eighth Circuit draws a distinction between discrimination based on sex stereotypes and that based on “notions of heterosexuality and homosexuality,” finding that Title VII protects against the former but not the latter. Though the basis for the claim is not always obvious, here—because Horton directly tied each of his claims to his homosexuality—the Court did “not struggle with exactly where to draw the line between actionable discrimination based on what is alleged to be gender non-conforming behavior and non-actionable discrimination based on sexual orientation.”

Despite the circuit split and legal uncertainty on the federal level, employers should be aware that many state and local laws offer protections against sexual orientation discrimination. And properly pled gender nonconformity claims may be pursued even in jurisdictions that do not recognize sexual orientation discrimination.  Thus, employers should train their employees to treat all employees equally in the workplace to prevent such claims.

As 2017 comes to a close, recent headlines have underscored the importance of compliance and training. In this Take 5, we review major workforce management issues in 2017, and their impact, and offer critical actions that employers should consider to minimize exposure:

  1. Addressing Workplace Sexual Harassment in the Wake of #MeToo
  2. A Busy 2017 Sets the Stage for Further Wage-Hour Developments
  3. Your “Top Ten” Cybersecurity Vulnerabilities
  4. 2017: The Year of the Comprehensive Paid Leave Laws
  5. Efforts Continue to Strengthen Equal Pay Laws in 2017

Read the full Take 5 online or download the PDF.

The New York City Council recently passed two bills affecting New York City employers and their employees. The first bill, Int. No. 1399, passed by the Council on December 6, 2017, amends Chapter 12 of title 20 of the City’s administrative code (colloquially known as the “Fair Workweek Law”) to include a new subchapter 6 to protect employees who seek temporary changes to work schedules for personal events.  Int. No. 1399 entitles New York City employees to request temporary schedule changes twice per calendar year, without retaliation, in certain situations, e.g., caregiver emergency, attendance at a legal proceeding involving subsistence benefits, or safe or sick time under the New York City administrative code.  The bill establishes procedures for employees to request temporary work schedule changes and employer responses.  Exempt from the bill are employees: (i) who are covered by a collective bargaining agreement; (ii) who have been employed for fewer than 120 days; (iii) who work less than 80 hours in the city in a calendar year; and (iv) who work in the theater, film, or television industries.

The second bill, Int. No. 804-A, passed by the Council on December 19, 2017, amends New York City’s Human Rights law to require covered entities engage in a “cooperative dialogue” with individuals who may be entitled to a reasonable accommodation. Covered entitles include employers, providers of public accommodations and providers of housing accommodations.  The term “cooperative dialogue” means the process by which a covered entity and an individual who may be entitled to an accommodation engage in a discussion to identify what reasonable accommodations are available to assist the individual.  The bill requires the covered entity to provide the individual requesting an accommodation a written final determination identifying any accommodation granted or denied.  This determination may only be made after the parties have engaged, or the covered entity has attempted to engage, in the “cooperative dialogue.”

Mayor DeBlasio likely will sign both bills into law by the end of the year.  New York City employers should be prepared to comply with the new requirements.

In Makinen v. City of New York, New York’s Court of Appeals held the New York City Human Rights Law precludes an individual from bringing a claim of disability discrimination based on a mistaken perception of untreated alcoholism.

The question arose in a case brought by police officers against the City of New York and certain individuals alleging discrimination based on the mistaken perception that the plaintiffs were alcoholics. The plaintiffs had been referred to an internal counseling service and directed to undergo treatment even though neither plaintiff had been diagnosed as suffering from alcoholism. The plaintiffs filed a lawsuit in federal court under New York State and City Human Rights Laws and the Americans with Disabilities Act.  The district court held individuals regarded as untreated alcoholics could state a claim under the City Human Rights law because analogous claims were available under state and federal law.  On appeal, the Second Circuit certified the following question to the Court of Appeals: “Whether sections 8-102(16)(c) and 8-107(1)(a) of the New York City Administrative Code preclude a plaintiff from bringing a disability discrimination claim based solely on a perception of untreated alcoholism?”

The Court of Appeals answered the certified question in the affirmative, finding the City Human Rights law was “only open to one reasonable interpretation: the disability of alcoholism shall only apply to a person who (1) is recovering or has recovered, and (2) currently is free of such abuse.”

Since the Restoration Act of 2005, courts have broadly construed the City Human Rights law to provide greater protections for employees than its federal and state counterparts. The Court of Appeals’ decision in Makinen represents a rare finding that the City Human Rights law provides less protection than state and federal law. Even so, employers should remain cognizant of the provisions of the New York State Human Rights Law and the Americans with Disabilities Act, as they already prohibit discrimination based on perceived alcoholism.

In New York, State Department of Labor (“DOL”) regulations provide that the minimum wage must be paid for each hour an employee is “required to be available for work at a place prescribed by the employer.” (12 NYCRR § 142-2.1(b)) (“Wage Order”). Exception is made for a “residential employee,” defined as one who lives on the premises of the employer, during his or her sleeping hours or any time he or she is free to leave the place of employment. Id.

On March 1, 2010, the DOL issued an Opinion Letter advising that sleep-in employees, whether or not they are residential employees, who work a twenty-four hour shift must be paid not less than for thirteen hours for a twenty-four hour period provided they are afforded at least eight hours for sleep, actually received at least five hours of uninterrupted sleep and are afforded at least three hours for meals. (NYS St. Dept. of Labor OP. No-09-0169 at 4 (March 11, 2010)). The Opinion Letter was a reiteration of the DOL’s long standing interpretation of the Wage Order as applied to home health care attendants, and agencies assigning attendants to twenty-four hour shifts have long followed it in paying the attendants for this shift.

In recent decisions, New York appellate courts have declined to defer to the DOL’s Opinion Letter because, according to those Courts, the letter conflicts with the plain language of the Wage Order. The Appellate Division First Department was the first to so rule in Tokhtaman v. Human Care LLC, 149 A.D. 3d 476 (1st Dept. 2017). Then, last week, the Appellate Division Second Department in Andryeyeva, on behalf of herself and all others similarly situated v. New York Home Attendant Agency, __ A.D. ___ (2nd Dept. 2017) and Moreno v. Future Care Health Services, Inc., ___ A.D. ___ (2nd Dept. 2017), adopted the First Department’s ruling.

The plaintiffs in Andryeyeva and Moreno were home health care attendants employed by the defendants to care for the elderly and disabled clients. They were assigned to twenty-four hour shifts in the client residents’ homes but claimed that they did not “live in” the homes. In Andryeyeva, they were paid an hourly rate for 12 hours of the shift and a flat rate for the 12 night hours. In Moreno, they were paid a flat fee for the entire shift. Plaintiffs in both cases argued that under the Wage Order they were entitled to the minimum wage for all twenty-four hours of the shifts. Defendants argued that plaintiff attendants were paid in accordance with the DOL Opinion Letter.

In Andryeyeva the Second Department acknowledged that it was required to uphold the DOL’s interpretation of the Wage Order as set forth in the Opinion Letter if it was not irrational or unreasonable. However, the court ruled that the DOL’s interpretation was neither rational nor reasonable because it conflicted with the plain language of the Wage Order. The court found that the plaintiffs were required to be at the client residences for the shift and were required to perform services if called upon. In reaching this decision the Second Department relied on the First Department’s decision in Tokhtaman, supra. The court also found that the plaintiffs met the prerequisites to class certification, thus allowing a class of over 1,000 attendants to proceed. The court in Moreno arrived at the same conclusion, noting that the DOL Opinion Letter conflicted with the plain language of the Wage Order because it failed to distinguish between “residential” and non-residential employees.

The state, trial and appellate court decisions in Andryeyeva, Moreno and Tokhtaman stand in contrast to the decisions in the United States District Courts for the Southern and Eastern Districts of New York, Severin v. Project OHR and Bonn-Wittingham v. Project OHR, which gave deference to the DOL’s interpretation of the Wage Order as set forth in the Opinion Letter and held that home health aides need only be paid for 13 hours of a 24-hour shift based on the 2010 DOL opinion letter.

The decisions in Andryeyeva and Moreno may be appealed to New York’s highest court, the Court of Appeals. If upheld there, the decisions present a serious challenge to the home health care industry. By declining to embrace the DOL’s opinion letter, the courts are opening the door to significant wage claims by New York’s tens of thousands of home health care attendants. Combined with the six-year statute of limitations on such claims in New York, this may lead to substantial back pay liability for the employing agencies, which could lead to a restructuring of those agencies and the services they provide.

What To Do

Home healthcare providers must pay close attention to all developments on this issue.

The Andryeyeva and Moreno cases may well be appealed, however, that process will likely take some time and there is no guarantee of a favorable outcome.

Given the potential adverse financial impact of the ruling on the home care industry as a whole, industry groups are likely to seek regulatory and/or economic relief from the New York State Departments of Labor and Health, and revisions to reimbursement rates for the 24 hour shifts.

The Department of Fair Employment and Housing (DFEH) recently released a brief, nine-page guide for California employers, which was prepared in conjunction with the California Sexual Harassment Task Force.  This guide is intended to assist employers in developing an effective anti-harassment program, including information about how to properly investigate reports of harassment and understand what recourse is available.  The guide addresses all forms of workplace harassment, including harassment based on sex.

Specifically, the guide provides employers with information regarding the particular components for an effective anti-harassment program in the workplace. The DFEH also gives employers step-by-step guidance for how to properly handle harassment complaints and any resulting investigations.  The guide discusses topics such as confidentiality during the investigation, the timeliness of an investigation, and investigator qualifications and training.  In its discussion of proper investigations, the DFEH provides nine “credibility factors” which an investigator may utilize in making a determination. These factors include a party’s motive to lie, any history of dishonesty, the manner of testimony – including hesitant speech and indirect answers – and the party’s demeanor during the investigation.  The guide also addresses what employers should do in unusual situations, such as: what to do when the target of harassment asks an employer not to act, how to investigate anonymous complaints, and how to handle retaliation.  The DFEH emphasizes the employer’s legal obligation to prevent and correct unlawful harassing behavior, and provides information regarding remedial measures. While some of these tips may seem intuitive, this guide is a good refresher for even the savviest of employers.

In conjunction with the guide, the DFEH also released an easy-to-follow brochure and corresponding poster specifically addressing sexual harassment, which employers can provide to their employees, in compliance with California Government Code section 12950(b). The brochure and poster echo many of the same tips as the guide, but focus solely on sexual harassment.  The poster and brochure include an explanation of what constitutes sexual harassment, provide examples of harassing behavior that may occur in the workplace, detail the civil remedies for harassing conduct, and outline an employer’s responsibilities and liability when allegations of sexual harassment are made.

Employers should utilize these DFEH resources when investigating and responding to claims of harassment made in the workplace.

In a landmark decision, the U.S. Court of Appeals for the Seventh Circuit, sitting en banc, held that discrimination on the basis of sexual orientation is covered under Title VII of the Civil Rights Act’s protections against discrimination on the basis of sex.

In Hively v. Ivy Tech Community College of Indiana, Kimberly Hively, a lesbian part-time professor at Ivy Tech, applied for but was denied several full-time positions with the college. After her employment was later terminated, she filed a lawsuit alleging that she was denied promotion and then terminated because of her sexual orientation. The lower courts held that they were bound by Seventh Circuit precedent to rule that sexual orientation was not a protected category under Title VII. On July 28, 2016, a three-judge panel of the Seventh Circuit held that sexual orientation discrimination is not sex discrimination. The Seventh Circuit agreed to hear the case en banc with all 11 judges.

Deviating from almost every other circuit court, the Seventh Circuit voted 8-3 that discrimination on the basis of sexual orientation is a form of sex discrimination. In March, the Eleventh Circuit held in Evans v. Georgia Regional Hospital, et al. that it was bound by precedent that concluded that Title VII does not extend protections on the basis of sexual orientation. Later in the month, the Second Circuit reached a similar conclusion in Christiansen v. Omnicom Group, et al. While that court found that the plaintiff had no viable claim for sexual orientation discrimination, it remanded the case to the Southern District of New York to address whether the plaintiff’s claims could be considered sex stereotyping discrimination.

The court acknowledged that the three-member panel in 2016 “described the line between gender nonconformity claim and one based on sexual orientation as gossamer-thin;” the majority now concludes that such a line “does not exist at all.”

Citing to the Supreme Court’s decisions in Meritor Sav. Bank, FSB v. Vinson (sexual harassment is discrimination on the basis of sex), Price Waterhouse v. Hopkins (sex stereotyping is discrimination on the basis of sex), and Onacle v. Sundowner Offshore Servs., Inc. (same sex harassment is discrimination on the basis of sex), the court held that sex discrimination has been understood to “cover far more than the simple decision of an employer not to hire a woman for Job A or a man for Job B.”

The majority addressed Hively’s two legal theories – (1) the comparative method, whether a woman and a man would be treated differently under the same facts, and (2) the associational theory, whether discrimination occurs against an individual because of the protected characteristic of one with whom the individual associates. Under each theory, the court reduced each inquiry to a simple question – if the employee in question were male instead of female, would it matter that the employee was in a relationship with a woman? Answering that if the sex of a plaintiff such as Hively in a lesbian relationship was changed, then the outcome would be different, the Court held that discrimination on the basis of sexual orientation necessarily is discrimination on the basis of sex.

The court acknowledged the long-standing critique of the judiciary with respect to civil rights issues – that the court was attempting to “legislate from the bench.” Writing for the majority, Chief Judge Diane P. Wood wrote that the decision to “amend” Title VII to add sexual orientation as a new protected category “lies beyond our power.” She further wrote: “We must decide instead what it means to discriminate on the basis of sex, and in particular, whether actions taken on the basis of sexual orientation are a subset of actions taken on the basis of sex. This is a pure question of statutory interpretation and thus well within the judiciary’s competence.” In response to the dissent’s reliance upon legislative intent, the Court noted that the definition of sex discrimination has expanded in numerous ways since the passage of Title VII, and that the Congress that enacted Title VII likely would be surprised as to the extent of expansion.

In an expectedly colorful concurrence, Judge Posner acknowledged that the Court is, in fact, re-writing Title VII because society’s definition of “sex” has changed over the past 50 years. Instead of relying solely upon stereotyping claims, as the majority writes, Judge Posner instead recognized that the judiciary has long been interpreting statutory language in the context of society’s new and changing understanding of terms. And here, Posner writes, that we should not rely upon the 88th Congress’ “failure” to divine how society’s interpretation of the term would change. Rather, he writes: “We understand the words of Title VII differently not because we’re smarter than the statute’s framers and ratifiers but because we live in a different era, a different culture.”

With a Circuit split, the question of whether sexual orientation is a protected characteristic under Title VII is ripe for review by the Supreme Court, although this case likely will not be the vehicle. Ivy Tech has released a statement that it does not intend to appeal. The decision in this case, however, may affect the Eleventh Circuit’s decision to rehear the Evans case en banc. When this issue does reach the Supreme Court, the soon-to-be-confirmed Supreme Court justice Neil Gorsuch could render an impactful vote should this reach the highest court.

How will the Trump administration handle discrimination cases involving transgender employees? The EEOC’s pursuit of a sex discrimination claim on behalf of Aimee Stephens, a transgender woman who was terminated by a Michigan funeral home for expressing her intention to dress in conformance with her gender identity, will be an early indicator.

In a brief filed with the Sixth Circuit on January 26, 2017, Stephens argues that the interests of transgender individuals will not be adequately represented under the new administration. Under the Obama administration, the EEOC sued Stephens’ former employer, R.G. & G.R. Harris Funeral Homes, for sex discrimination on her behalf. The funeral home owner argued permitting Stephens to dress as a woman would conflict with his Christian beliefs and pose a threat to his free exercise of religion. The Eastern District of Michigan dismissed the EEOC’s lawsuit in August 2016 on the grounds that the funeral home is exempt from Title VII under the Religious Freedom Restoration Act (“RFRA”). Although the EEOC appealed to the Sixth Circuit in October 2016, Stephens filed a motion to intervene as plaintiff-appellant, citing her belief that the new administration would not adequately represent her interests.

Over the course of Obama’s presidency, the trend in federal government was the extension of protections for transgender individuals. Many federal agencies, including the EEOC, OFCCP, OSHA, and HHS, previously promulgated rules and guidance affording increased protections for transgender individuals. Numerous federal courts, including the First, Sixth, Ninth, and Eleventh circuits, have applied theories of sex stereotyping under Section 1983 or Title VII, resulting in protections for transgender individuals. Few courts, however, have found gender identity or transgender status is a protected class under Title VII. Indeed, the district court in G.R. & R.G. Funeral Homes rejected that position when presented by the EEOC.

Whether the EEOC will continue to aggressively pursue the expansion of Title VII to include transgender protections remains an open question. While still just a rumor, it has been reported that the Trump administration is considering an executive order that would provide individuals and organizations the ability to deny employment, as well as services and other benefits, to LGBT individuals on religious grounds. In her motion, Stephens references the removal of the White House webpage dedicated to LGBT rights, the federal government’s requests for extensions of time in other civil rights cases, and the President’s authority over EEOC appointments as reasons she believes her interests may not be adequately represented. Further, the current acting chair of the EEOC, Victoria Lipnic, was one of two commissioners who voted against the EEOC’s July 2015 decision that held that sexual orientation is included within the definition of sex for discrimination purposes under Title VII. The Trump administration also has rescinded guidance previously issued by the departments of Education and Justice under the Obama administration that took the position that the Title IX prohibitions of discrimination “on the basis of sex” require access to sex-segregated facilities based on gender identity.

On the other hand, the EEOC filed its opening brief with the Sixth Circuit just two weeks after Stephens moved to intervene, arguing that (a) discrimination based on transgender status and/or transitioning is inherently sex discrimination under Title VII; and (b) the RFRA does not provide the for-profit funeral home a defense in this case. This stance is consistent with that taken by the EEOC while Obama was in office. Further, Trump has indicated Executive Order 13672, which banned federal contractors from discriminating against LGBT employees, will stand.

Stephens’ case may have implications for the protection of transgender employees at the federal level, but employers need to keep in mind that many states explicitly prohibit discrimination against transgender workers. At least sixteen jurisdictions – including California, Illinois, Maryland, Massachusetts, New Jersey and the District of Columbia – now include gender identity as a protected characteristic under their discrimination laws.

Employers are advised to familiarize themselves with their state and local laws, to take a proactive role in preventing transgender, or gender identity, discrimination in the workplace, and to have a plan in place to accommodate the potential needs of transgender workers.