The Dallas Hospitality Employment Lawyer Blog

In a Memo issued on December 15, 2014 by the United States Department of Justice, Office of the Attorney General, the government has advised that it now takes the position that Title VII's prohibition against sex discrimination encompasses discrimination based on gender identity, including transgender status. Employers should review their handbook policies and train managers to understand that discrimination against transgendered employees is now actionable under Title VII.

The United States Department of Labor (DOL) is increasing its scrutiny of tip pooling practices.  An inappropriately administered tip pool can result in its invalidation, which can in turn result in liability to the employer for unpaid wages.  To ensure a safe tip pool, consider the following: 1.     Notify employees in writing of the tip credit arrangement.  For example, you can make a notation on the pay stubs, include an acknowledgment in a new hire packet, or post a notice near the time clock.  The key here is to provide adequate notice to employees and retain proof of this notice.   2.     Keep management out of the tip pool.   Remember that only employees who "regularly receive tips" can participate in a valid tip pool.  This usually excludes management-level employees. 3.     For employees who perform tipped and non-tipped jobs (such as an employee who serves as both a waiter and a dishwasher depending...

On July 14, 2014, the Equal Employment Opportunity Commission (EEOC) issued its latest Enforcement Guidance on pregnancy and related conditions.  You can find a copy on the EEOC's website (eeoc.gov).  As expected, the EEOC has taken an expansive view of the protections offered by the Pregnancy Discrimination Act (PDA), and based on its interpretations, many employers may unknowingly be in violation of the law. PDA Refresher Congress passed the PDA in 1978 to clarify that sex discrimination prohibited by Title VII of the Civil Rights Act of 1964 (Title VII) includes discrimination based on pregnancy, childbirth, or related medical conditions.  The PDA requires that pregnant employees be treated the same as non-pregnant employees who are similar in their ability or inability to work. The EEOC's Interpretation of PDA Coverage The EEOC takes the position that the PDA prohibits discrimination based on: current pregnancy; past pregnancy; potential or intended pre...

In a decision issued on Monday, an Administrative Law Judge (ALJ) ruled that a number of an employer's handbook policies violated Section 7 of the National Labor Relations Act (the "Act").   See Hoot Winc, LLC, NLRB ALJ , No. 31-CA, 104872 (May 19, 2014). The underlying dispute involved the termination of employees who were allegedly involved in, among other things, a dispute about a bikini contest.  In a lengthy ruling in favor of the employee, the ALJ found that a number of the employer's policies violated the Act, including those prohibiting: employees from discussing tips with other employees or guests. insubordination to a manager or lack of respect or cooperation with fellow employees or guests. disrespect to a guest , including profanity or negative comments or actions. the unauthorized dispersal of sensitive company operating materials. actions or activities the complaints believes represent a threat to the smooth operation, goodwill, or profitabil...

Arbitration agreements aren't right for every employer, but if you utilize one, now is a good time to determine if it is as comprehensive as it could be.  When reviewing your existing arbitration agreement, ask yourself these questions: Does it require the arbitration of all employment-related claims, and exclude claims for, by way of example only, workers' compensation and unemployment benefits, administrative charges, and claims for declaratory and/or injunctive relief?   Is it mutual, meaning it equally binds both employer and employee? Have you reviewed your handbook language to ensure that there are no conflicts between the handbook language and the arbitration agreement? Does it indicate which party or parties is responsible for arbitration filing and other costs? Do you ensure each employee signs a copy of the arbitration agreement upon hire, and retain that copy in the personnel file? Does it specify that the arbitrator can award all relief that could be awarde...

The 2009 amendments to the Americans with Disabilities Act (ADA) left no doubt that Congress intended to expand the ADA's scope, but is this pendulum swinging too far?  In a recent decision, a Missouri court refused to grant an employer's motion to dismiss a plaintiff's disability discrimination claim where the alleged disability is obesity.   See Whittaker v. America's Car-Mart, Inc ., Case No. 1:13CV108SNLJ, in the United States District Court, Eastern District of Missouri, Southeastern District. In that case, the plaintiff contends he was discharged based on his severe obesity.  The employer moved to dismiss the lawsuit on the grounds that obesity is not a disability unless it is related to an underlying physical or psychological disorder or condition.  Denying the motion to strike, the court noted that with the 2009 amendments, Congress mandated that the definition of "disability" be construed in favor of "broad coverage."  Although ...

This is the time of year when most people review their assets and insurance elections, clean our their closets and attics and discard unnecessary belongings.  In the spirit of spring cleaning, it is also a good time for hospitality employers to review their policies and procedures to ensure they do not run afoul of ever-changing employment laws. This blog article will be the first of several parts to provide tips and suggestions for this important project. For a good place to start, dust off the employee handbook, personnel manual, or whatever you have that advises employees of the company's policies and procedures, read it from cover to cover, and ask yourself these questions: Does it contain an at-will employment disclaimer?  If so, does it comply with the recent ruling by the National Labor Relations Board (NLRB) regarding appropriate language? Does it contain any type of confidentiality or other provision that prohibits employees from discussing salaries?  ...

In a decision issued this week, the Fifth Circuit upheld and enforced a National Labor Relations Board (NLRB) order finding that a portion of a  non-unionized employer's confidentiality policy violated the National Labor Relations Act because it was overly broad and contained language employees could reasonably interpret as restricting the exercise of their Section 7 rights.  See Flex Frac Logistics, L.L.C. v. National Labor Relations Board,  No. 12-60752 (Mar. 24, 2014).  The employer's confidentiality policy included the following language: "Confidential information includes...personnel information and documents..." The NLRB found that even though the clause did not reference wages or the specific terms or conditions of employment, the clause nevertheless violated the NLRA.  In reviewing the NLRB's order, the Court reiterated that a workplace rule that forbids the discussion of confidential wage information between employees violates the NLRA....

It is common knowledge there are no magic words required for an eligible employee to make a valid request for FMLA leave.  But what happens when an employee makes a vague request?  The Eleventh Circuit answered this question in Hurley v. Kent of Naples, Inc. et al ., No. 13-10298 (11th Cir. Mar. 20, 2014).   Hurley, an executive, sent the CEO an e-mail that included a list of eleven weeks of vacation over a two year period.  The executive denied the request and asked to schedule a meeting to discuss the e-mail.  In response, Hurley sent another e-mail to the executive that said the vacation request "was not a request it was a schedule…I have been advised by my medical health/health professionals that my need to avail myself of vacation time that I have earned is no longer optional."   The next day, the two met, and the executive terminated Hurley for insubordination and poor performance.   A week after Hurley's discharge, he visited his health...

Congress enacted the Sarbanes-Oxley Act of 2002 (SOX) to safeguard investors in public companies and restore trust in the financial markets following the collapse of Enron. In a recent decision, the United States Supreme Court ruled that the whistleblower protection included in SOX protects not only the employees of public companies, but also the employees of privately-held contractors and subcontractors who render services to public companies.   See Lawson v. FMR LLC, No. 12-3 (March 4, 2014).   Drawing on, among other things, the legislative record, the plain language of the statute and Congressional intent, the Court noted that to exclude employees of private contractors and subcontractors would leave them vulnerable to retaliation by their employers for blowing the whistle on schemes to defraud public company investors, even if the schemes were engineered entirely by the contractor or subcontractor. Private contractors and subcontractors that do business with...

Today President Obama is expected to direct the United States Department of Labor to revise overtime pay regulations under the Fair Labor Standards Act to expand the scope of employees entitled to overtime pay.  Although the President's directive could take considerable time to accomplish, it could have a significant impact on the hospitality industry by increasing the number of employees, such as certain types of managers, who would no longer be classified as exempt.

Last October, the Tenth Circuit Court of Appeals dealt the Equal Employment Opportunity Commission (EEOC) a blow when it reversed a religious failure to accommodate summary judgment ruling in the EEOC's favor and remanded the case with instructions to grant summary judgment in favor of the defendant, retailer Abercrombie & Fitch Stores.   See EEOC v. Abercrombie & Fitch Stores, Inc ., No. 11-5110 (10th Cir. 2013).   In the Abercrombie case, the Tenth Circuit found that Abercrombie was entitled to summary judgment as a matter of law because there was no genuine dispute of material fact that Ms. Elauf (the individual on whose behalf the EEOC sued) never informed Abercrombie prior to its hiring decision that she wore her headscarf, or “hijab,” for religious reasons, and that she needed an accommodation for that practice due to a conflict between the practice and Abercrombie’s clothing policy.  In the decision the Court repeatedly referenced the EEOC's Comp...

On February 25, 2014, Richard F. Griffin, Jr., General Counsel for the National Labor Relations Board (NLRB), issued a memo to all Regional Directors, Officers-in-Charge, and Resident Officers instructing them on the types of cases that require submission to the Division of Advice (the NLRB's legal department) prior to the issuance of a decision. Despite Mr. Griffin's position that "the vast majority of cases can be processed without guidance from headquarters," he then proceeds to identify 3 "areas" requiring legal review: (1) cases that involve the General Counsel's initiatives or policy concerns; (2) cases that involve difficult legal issues or the absence of clear precedent; and (3) "other case-handling matters."   The memo includes no less than 24 types of cases that require submission to the Division of Advice, such as: Cases involving the issue of whether employees have a Section 7 right to use an employer's e-mail system; ...

On February 6, 2014, the National Labor Relations Board (NLRB) affirmed an Administrative Law Judge's ruling that a portion of an employer's confidential information policy violated Section 8(a)(1) of the National Labor Relations Act (Act).   See MCPc, Inc. , Case 06-CA-063690, 360 N.L.R.B. No. 39.   As most employers do, MCPc maintained a confidential information policy in its handbook that prohibited employees from: (1) storing, outside of the company, information pertaining to any matter related to the company's business; (2) providing anyone with information about the company's purchase prices or processes without permission of senior management; and (3) engaging in "idle gossip or dissemination of confidential information within [the company], such as personal or financial information…."  A violation of the policy could lead to disciplinary action, up to and including discharge. MCPc discharged an employee after he commented, during an internal m...

On February 11, 2014, a judge in Illinois denied United Parcel Service's 12(b)(6) motion to dismiss, finding that its policy of administratively separating employees after twelve months of leave is a "medical requirement" that may violate the Americans with Disabilities Act, as amended ("ADA").   See EEOC v. United Parcel Service , No. 09-C-5291, in the United States District Court, Northern District of Illinois, Eastern Division. UPS' policy applies to qualified individuals with disabilities who can perform the essential functions of their jobs, with or without reasonable accommodations.  The court rejected UPS' argument that the ability to attend work is an essential job function, finding instead that the twelve-month policy can be considered a qualification standard, or medical requirement, that an individual must meet to retain his or her position.  The court's order cited to cases holding that a 100% healed policy is per se impermissible b...

On January 31, 2014, the Fifth Circuit Court of Appeals reversed a hostile work environment jury verdict based on race, finding that the employer's prompt remedial action was sufficient to defeat the claim.   See Williams-Boldware v. Denton County , Texas , No. 13-40044. In that case, the African-American plaintiff complained about racially inappropriate language directed at her by her Caucasian male co-worker.  Within twenty-four hours of her complaint, the co-worker had issued a written apology, and the complaining employee's immediate supervisor reported the incident to human resources.  The employer then reprimanded the co-worker, required him to participate in diversity training, and transferred the plaintiff to a different division to ensure she had no contact with the co-worker.   The race harassment claim proceeded to trial, and the trial court denied the employer's motion for judgment as a matter of law.  The jury awarded the plaintiff over $40...

On November 5, 2013, the State of Texas filed suit against the Equal Employment Opportunity Commission (EEOC) challenging the EEOC's April 2012 Enforcement Guidance titled, " Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964 ." See State of Texas v. EEOC , Case No. 5:13-CV-00255-C, In the United States District Court for the Northern District of Texas, Lubbock Division.  The Plaintiff State of Texas took issue with the EEOC's position regarding the hiring of convicted felons, and asked the Court for the following relief: (1) a declaratory judgment and injunction that the State's "No-Felons Policies" do not constitute "unlawful employment practices"; (2) a declaratory judgment that the EEOC's Guidance is unlawful (and not just the portion related to state laws) because the EEOC exceeded its statutory authority; and (3) a declaratory judgment that the EEOC's interpret...

Yesterday, the Seventh Circuit Court of Appeals agreed with a district court and found that a woman's trip to Las Vegas with her terminally-ill mother qualified as FMLA leave.   See Ballard v. Chicago Park District , No. 10-C-1740, January 28, 2014.   Plaintiff Beverly Ballard worked for the Chicago Park District and cared for her mother, Sarah, who was receiving hospice care for end-stage congestive heart failure.  During a meeting attended by Beverly, Sarah, and the social worker to discuss Sarah's end-of-life goals, Sarah told her daughter she had always wanted to take a family trip to Las Vegas. With help from a nonprofit agency, the social worker secured funding for the trip, and Beverly and Sarah headed to Vegas for six days of fun-filled, Sin City tourist attractions. During the trip, Beverly continued to provide care to her mother, even finding replacement insulin when a fire at their hotel prevented them from accessing Sarah's medicine.  The Chicago...

Restaurant Opportunities Centers United ("ROC"), with offices in Pennsylvania, Texas, and Washington, D.C., identifies itself as a national intermediary that helps initiate Restaurant Opportunities Centers around the country.  According to its website, ROC uses tactics including organizing workers, litigation, and public pressure to achieve its version of "Workplace Justice."   ROC contends its mission includes: (1) raising the minimum wage from $7.25 per hour to $10.10 per hour over the next three years, and the tipped minimum wage from $2.13 to 70% of the regular minimum wage; (2) guaranteeing workers a minimum number of paid sick days; and (3) ending what it refers to as "occupational segregation."   For the past few years, ROC has published its Diners' Guide to Ethical Eating,  which purports to rank restaurants from the top 100 highest revenue-grossing restaurants in the United States, in five categories:  ROC partner, tipped wages, non-t...

Social media is widely-used in the hospitality industry for everything from promoting sales to recruiting new talent.  Facebook, Twitter, Pinterest, Foursquare, and a number of other sites provide hoteliers and restaurateurs with nearly limitless access to local, national, and international audiences. In recent years, sites like Yelp have emerged to provide customers with an anonymous, online platform to post reviews of businesses, and its impact is far-reaching.  In the first quarter of 2013, Yelp allegedly averaged nearly 102 million unique visitors per month.    Many businesses understand the importance of widespread feedback, monitor Yelp and other sites for both positive and negative reviews, and interact with reviewers about their experiences.  Cyber-saboteurs are an unfortunate risk to companies with an Internet presence, and a number of employers have undoubtedly been the subject of anonymous, negative and disparaging attacks by competitors or d...

On Monday, January 6, 2014, the National Labor Relations Board (NLRB) announced it would not seek review by the United States Supreme Court of two appeals courts decisions invalidating the NLRB's Notice Posting Rule, which would have required most private employers to post a notice in the workplace advising employees of their rights to unionize. In 2013, two appellate courts, the D.C. Circuit and the Fourth Circuit, enjoined the NLRB from requiring the posting, and subsequently denied the NLRB's request for en banc review.  This left the NLRB with the option of appeal to the United States Supreme Court. The NLRB's decision lays to rest, at least for now, its attempt to force employers to affirmatively assist with unionizing efforts.

In December 2013, the State of Colorado legalized the recreational use of marijuana.  Portland, Maine and Washington State have done the same, and several cities in Michigan have voted to legalize the possession of up to one ounce of marijuana for use on private property.  Other states face similar ballot initiatives.   January 1, 2014 was the first day marijuana could be sold to anyone over the age of 21 from specially-licensed stores in Colorado. The recreational use of marijuana remains illegal in Texas. The citizens of Colorado amended their constitution to permit recreational marijuana use.  Below is a summary of key provisions and enforcement information: according to the constitutional amendment, marijuana is to be regulated in a manner similar to alcohol; a Colorado resident, 21 years of age or older, may possess, use, display, purchase, or transport (although not across state lines) marijuana accessories, and up to one ounce...

For years, it has been common practice in the hospitality industry to include an automatic gratuity on the bills of larger parties, usually defined as eight or more guests.  The purpose of this practice was to, among other things, ensure that servers were not short-changed on large tabs.  Prior to January 2014, automatic gratuities were treated as tips for employees to report as income. Starting now, the IRS will classify automatic gratuities as "service charges," which means they will be treated as regular wages subject to payroll tax withholding (FICA).   Hospitality employers should be mindful that their characterization of a "tip," whether communicated orally or in writing to employees, is not controlling for purposes of this rule.  According to the IRS, the absence of any of the following factors creates a doubt as to the status of a payment as a tip, and indicates the payment may be a service charge: 1.  the payment must be made free from co...