HR at the Supreme Court

HR at the Supreme Court | Human Resource Executive Online There are no blockbusters on the docket, but the workplace-related cases this term include allegations of retaliation following an internal investigation, selection of pension beneficiaries as well as how such funds should be calculated for pregnant employees, and two cases involving unions -- relating to arbitration and politicking.

Monday, October 20, 2008
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Several issues affecting human resources are on the U.S. Supreme Court docket this term, but some court observers doubt any of the rulings will have sweeping impact on HR or the American workplace.

"There are important cases, but no core issues when it comesto affecting the day-to-day work of an HR professional," says Larry Lorber, a partner in the Washington office of the law firm of Proskauer Rose, who represents employers. "These won't be front-page news. They are more like, "In other news, the Supreme Court today ... ."

The most closely watched case relating to the workplace is Crawford vs. Metropolitan Government of Nashville and Davidson County Tenn. The plaintiff, Vicky Crawford, a 30-year employee in the municipal payroll department, answered questions during an informal inquiry into allegations that the director of employee relations had engaged in sexual harassment. Part of the director's duties was the investigation of sexual-harassment complaints.

Crawford -- who did not initiate the formal investigation or file any formal charges -- stated that the director had made repeated inappropriate gestures and comments in the workplace. Following the investigation, the director was given a verbal reprimand. A short time later, Crawford and two other women who had participated in the inquiry were fired.

Crawford sued, claiming her firing was retaliation for her participation in the inquiry. The defense maintains the firings were unrelated to the inquiry.

Brett Gorovsky, an attorney and employment-law analyst with Riverwoods, Ill.-based CCH Inc., who tracks and analyzes employment-law issues, says a ruling against Crawford could have a chilling affect in the workplace, as employees would fear that participating in internal investigations could get them fired.

"This is probably the hottest case as far as HR goes and how internal investigations are handled," says Gorovsky. "If Crawford loses, it may deter employees from wanting to whistleblow against harassment. They are not going to want to speak up."

Lorber has a different take. He thinks a ruling in favor of Crawford would open the door to employees and their legal counsel to use participation in internal investigations as cover should they be reprimanded or terminated for issues unrelated to the investigation, such as performance on the job.

"Participating in an internal investigation shouldn't give an employee blanket immunity for the next six months for whatever they may do on the job," Lorber says.

Another case with potential implications for those in HR involves arbitration. Penn Plaza vs. Pyett focuses on the question of whether an arbitration clause in a collective-bargaining agreement is a waiver of an employee's right to sue for alleged discrimination.

Three former employees of Temco Service Industries, who were employed as night watchmen at 14 Penn Plaza in New York, claim job reassignments amounted to age discrimination and violated their unions' collective-bargaining agreement.

"HR professionals who work for a unionized employer will be interested in this case," says Gorovsky. "If the court, which is decidedly pro-arbitration policy, goes in that direction, look for employers to fight to put such clauses in the collective-bargaining agreements with unions possibly resisting.

"If the court holds that unions cannot waive the right to a judicial forum, employers, and this is where HR could get involved, may ask employees to sign agreements to arbitrate anyway, even if they are represented by a union," he says.    

Several other cases are also worth watching. Here's a rundown:

Kennedy vs. Plan Administrator for Dupont Savings and Investment Plan

Benefits administrators should track this one closely. At the time of his death in Texas in 2001, William Kennedy had not updated his financial paperwork in accordance to his previous divorce decree from 1994.

Dupont, Kennedy's employer, recognized the beneficiary stated on his retirement accounts was his ex-wife, Liv. Meanwhile, Kennedy's daughter maintained that failure to update the paperwork at Dupont was simply an oversight, and that the ex-wife should not be the beneficiary.

Put in technical terms, the question is whether ERISA's Qualified Domestic Relations Order provision is the only valid way a divorcing spouse can waive his or her rights to receive an ex-spouse's pension benefits under ERISA.

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Ben Ysura, Idaho Secretary of State vs. Potatello Education Association

Ysura raises a timely question regarding union politicking. This First Amendment case tests whether Idaho can force local governments to limit their employees' political activities.

The U.S. 9th Circuit Court of Appeals held that an Idaho statute prohibiting local government employers and school employers from making payroll deductions for "political activities" is unconstitutional. The federal appellate court reasoned that such a law violates the First Amendment rights of labor unions that represent employees.

Locke vs. Karass

Another case with potential implications for union workplaces focuses on 20 nonunion employees of Maine's state government who claim they have been improperly charged for litigation expenses that did not directly relate to the bargaining unit.

The Locke case presents a possible opportunity for the court to revisit the prevailing constitutional standard for determining when public-sector unions may compel financial support for their activities from non-members.

The case is the latest in a series of cases brought by the National Right to Work Legal Defense Foundation, which has consistently disputed various financial obligations placed on employees who are covered by a collective-bargaining agreement, but object to union activities.

"I doubt this case will have any significant impact on many HR people," Lorber says. "I think it is more of an issue for public-sector unions."

AT& T vs. Hulteen

A benefits-oriented case, AT&T vs. Hulteen hinges on whether maternity leave taken before the passage of the 1978 Pregnancy Discrimination Act can be considered in calculating employee-pension benefits.

In 2001, Noreen Hulteen and several other women sued AT&T, alleging that its decision to pay them smaller pensions because of their pregnancy disability leaves taken prior to 1978 constituted an unlawful employment practice under the Pregnancy Discrimination Act. AT&T argues the 1979 law cannot be applied retroactively.


Gorovsky says the eventual Supreme Court ruling will provide clarity in regards to whether laws relating to benefits can be applied retroactively.

The Supreme Court is expected to hand down decisions in the case in early 2009.

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