Well, it’s been a while since my last post. I tried two cases and went on vacation.  Wow. I came back from Europe to a full fledged financial crisis.  Well, don’t read this post if you expect any advise or wisdom about the plunge. I’m a labor lawyer.  One bit of a surprise… I came back to find a “new and improved” Governor Jon Corzine pontificating about the need to make New Jersey “business friendly.” Of course, just months earlier, Corzine enthusiastically signed bills dumping new taxes on employers and businesses, even as they were leaving the state in record numbers. Maybe too little. Maybe too late. Welcome, aboard Governor.

Anyway, this blog is about the new amendments to the American with Disabilities Act (“ADA”). Congress enacted some important changes to the ADA,  called the ADA Amendments Act of 2008 (“ADAAA”), and I think it is very important for employers, employees, and unions to know what they are.  The changes go into effect on January 1, 2009.

What’s the Current Law? Currently, the ADA defines disability as: (1) a physical or mental impairment that substantially limits one or more of the major life activities of such individual; (2) a record of such an impairment; or (3) being regarded as having such an impairment. However, the ADA does not explicitly define the terms “impairment,” “substantially limits,” or “major life activity.”

Several U.S. Supreme Court decisions interpreted the ADA as setting a very high standard in order to qualify as a disabled individual. This standard was such that it actually excluded many employees who common sense would seem to dictate should have been treated as disabled. In Toyota Motor Mfg. of Kentucky, Inc. v.Williams, 534 U.S. 184 (2002), for example, the Supreme Court interpreted “substantially limits” to mean preventing or severely restricting an individual from doing activities that are of central importance to most people’s daily lives. In Sutton v. United Air Lines Inc., 527 U.S. 471 (1999), the Supreme Court stated that measures taken to mitigate physical and mental impairments must be considered when deciding whether an individual is substantially limited in a major life activity.

What’s the New Law? The new law rejects the Supreme Court’s statutory interpretation as too restrictive and specifically overturns these and other decisions. The definition of disability is expanded to be read broadly and to cover more plaintiffs.  The Act widens the definition of “impairment.” An impairment need only limit one major life activity, and an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active. This provision is intended to clarify that the ADA applies to individuals suffering from illnesses such as diabetes, cancer or epilepsy who, in some cases, were previously denied protection because their conditions could be treated with medication or were in remission.

What are Major Life Activities? The new law now specifies certain activities that qualify under the Act as a “major life activity.” These include but are not limited to: caring for oneself; performing manual tasks; seeing; hearing; eating; sleeping; walking; standing; lifting; bending; speaking; breathing; learning; reading;concentrating; thinking; communicating; working. Also included are major bodily functions, such as: functions of the immune system; normal cell growth; digestive bowel bladder; neurological; brain; respiratory; circulatory; endocrine; reproductive;

What about Mitigating Measures? With the exception of “ordinary eyeglasses and contact lenses,” the amendments eliminate consideration of mitigating measures in determining whether a person is substantially limited in a major life activity. The proposed language explicitly forbids consideration of the following: medication; medical supplies, equipment or appliances; low vision devices; prosthetics; hearing aids and other implanted hearing devices; mobility devices; oxygen therapy equipment and supplies;use of assistive technology; reasonable accommodations or auxiliary aids or services; learned behavioral or adaptive neurological modifications;

An entity covered by the ADA also may not use qualification standards, employment tests or other selection criteria based upon an individual’s uncorrected vision unless the entity can show job-relatedness or business necessity.

What about changes to the “Regarded As” Standard? The amendments lower the standard to prove an employer discriminated against an individual whom it “regarded as” having a disability. Traditionally, an individual claiming she or he was “regarded as” having a disability had to prove either the employer mistakenly regarded the individual as having an impairment that substantially limited a major life activity or the employer mistakenly believed that an actual impairment substantially limited the individual. The amendments will hold an employer liable under a “regarded as” theory if the individual can show discrimination because of an actual or perceived physical or mental impairment, whether or not the impairment actually limits or is perceived to limit a major life activity.

On the plus side, however, the ADAAA clarifies that “regarded as” claims cannot be based on transitory and minor impairments where the impairment is expected to last less than six months. The ADAAA also clarifies that employers are not required to provide a reasonable accommodation to individuals who are regarded as disabled, an issue over which the federal courts of appeals were previously split.

What Should Employers Do? The expanded definition of “disability” necessarily means that there will be more employees who, as needed, will seek a reasonable accommodation.  There is also a risk that there will be more lawsuits. Reduce exposure to liability by reviewing internal procedures and making sure that supervisors and managers are properly trained.  Focus on making sure that they know exactly what they will need to do when an employee asks for a reasonable accommodation.

On July 31, 2008, the New Jersey Supreme Court issued an important decision clarifying the legal standard for hostile work environment claims based on religious discrimination, holding that religious harassment, racial harassment, and sexual harassment claims must be treated identically in terms of proof. Cutler v. Dorn, A-51 (N.J. July 31, 2008). The decision brings an end to the confusion caused by another Supreme Court case, Taylor v. Metzger, 152 N.J. 490 (1998), and an older Appellate Division case, Heitzman v. Monmouth County, 321 N.J. Super. 133 (1999), which together held that racial harassment claims brought by African-Americans would receive preferential treatment while religious discrimination claims brought by Jewish plaintiffs were to be judged by a tougher standard.

In Cutler, a Jewish police officer filed a NJLAD claim alleging that the defendants created, perpetuated, and failed to remediate a hostile work environment based upon his religion or ancestry. Plaintiff alleged that in 1999, he heard one officer blurt out to another officer “those dirty Jews,” a remark for which that co-worker apologized within one-half hour, and for which he received a disciplinary letter of counseling. He also claimed that in a subsequent and unrelated disciplinary hearing involving another officer, this same officer described his comment in plaintiff’s presence as “Let’s get rid of all those dirty Jews, ” reopening the wound inflicted by his earlier comment. Plaintiff also alleged that, among other things, someone placed an Israeli flag in his locker in 1996, and about two weeks later, someone placed a sticker of the German Republic flag above it; and at Passover 1999, a supervisor advised him that he could not wear a yarmulke to work. At trial, the jury found that plaintiff proved he was subjected to a hostile work environment based on his religion or ancestry, but awarded him zero damages. The trial court then denied Haddonfield’s motion for judgment notwithstanding the verdict (“JNOV”).

The Appellate Division reversed the trial court’s denial of Haddonfield’s NOV motion. Cutler v. Dorn, 390 N.J. Super. 238 (2007). The court held that while the NJLAD prohibits harassment in the workplace that creates a hostile work environment, it is not a civility code; epithets or comments that are merely offensive do not create a hostile work environment. The court must look at such circumstances as the frequency of the discriminatory conduct, its severity, whether it is physically threatening or humiliating, and whether it unreasonably interferes with an employee’s work performance.

The Appellate Division found that although the comments and pranks were offensive, plaintiff was a full participant in a work environment in which the officers and some supervisors, including the plaintiff, participated in pranks, teasing, and “breaking each others chops.” The plaintiff had a key to one of two locked cabinets in which officers maintained and distributed a “humor file,” with material of a racial or ethnic nature directed at various groups, including Jews. Plaintiff admitted that he shared and enjoyed this material, and never complained prior to 1999. He also participated in ribbing directed at other officers based upon their religion, particularly those of the Christian faith. The court observed that until 1999, plaintiff never objected or complained, evidencing “acquiescence in the activities as part of the give-and-take in which he regularly participated.”

The Appellate Division, in reversing the trial court, struggled to distinguish the case Taylor and Heitzman. In Taylor, the New Jersey Supreme Court affirmed the state’s power to punish a county sheriff who directed a single racial epithet towards an African American. The Court announced that it would interpret the NJLAD differently for African Americans because of their “unique history” of oppression.

One year later, in Heitzman, the Appellate Division dismissed a claim brought by a Jewish worker who was subjected to a constant barrage of anti-Semitic slurs. Although the court agreed that calling a Jewish woman a “Jewish bitch,” and telling the plaintiff that, “if Hitler were alive, he would make a lampshade out of you,” was both offensive and anti-Semitic, the court decided that no reasonable Jewish person could conclude that the anti-Semitic comments could create a hostile or abusive work environment.

In Cutler, the Supreme Court, while agreeing that there were no monetary damages, reversed the Appellate Division, making it clear, once and for all, that religious harassment claims are to be treated no differently than other claims for harassment or discrimination. Justice Jaynee LaVecchia, writing for a unanimous Court, stated that “[c]onsistent with this state’s strong policy against any form of discrimination in the workplace, we hold that the threshold for demonstrating a religion-based, discriminatory hostile work environment cannot be any higher or more stringent than the threshold that applies to sexually or racially hostile work environment claims.”

More bad news about the exodus of employers and jobs from New Jersey. The Newark Star Ledger just reported that the Blackstone Group is negotiating with Pennsylvania to move a back office employing 1200 or so people to Philadelphia.  New Jersey law makers just shrug their shoulders, clueless as to the reasons for the exodus … high taxes,  exorbitant cost of living, over-regulation, and irrationally pro-employee labor and employment laws.  So how does Governor Corzine mark this growing crisis?  On Thursday, he signed a new fair housing law that requires developers to pay a new 2.5% tax on the value of a newly built commercial buildings!  Apparently, our Governor thinks he can entice employers to stay in New Jersey by imposing yet another tax burden. Good thinking.

Last year, two Rutgers economists from the Edward Blaustein School of Planning and Public Policy, Joseph Seneca and James Hodges, published a study detailing the incredible loss of businesses and workers from  New Jersey. Professors Hodges and Seneca observed that New Jersey’s loss of residents to other U.S. states more than tripled between 2002 and 2006, draining $10 billion in personal income from the economy and reducing tax revenue by $680 million. The number of people who left New Jersey exceeded those who moved in from other parts of the nation by 72,547 last year.   The reported also noted that New Jersey’s net migration loss, the deficit in the number of residents moving in from other states compared with those leaving for elsewhere in the country, is the fourth-highest in the U.S., trailing only California, New York, and Louisiana.

Compare those figures to North Carolina. Between 2000 and 2006, North Carolina gained 807,000 people, while New Jersey gained 310,000. North Carolina was one of the top destination states of New Jersey residents who moved out, according to the study.  North Carolina had a net migration gain of more than 100,000 people last year.

The report is a devastating critique of New Jersey policies. It should serve as a reminder that tax, regulatory and employment policies have consequences.  It’s time we took an honest look at them.

I urge you to read the report at http://policy.rutgers.edu/news/reports/RRR/RRR_October_2007.pdf.

Jed

When I was a school boy in what was then a rural section of New Jersey, I was often disciplined for fighting in the school yard with the other boys. On one occasion, the principal decided to send me home and to that end called my grandfather to pick me up. When my grandfather arrived, he was invited into the principal’s office, where he and I were served up with a self righteous rant on fighting and my precarious place at school, concluding that I “was a good for nothing.” My ancient grandfather demurred, observing that I was not a good for nothing, that I could always serve as a bad example!

What made me think about my grandfather’s observation was a recent story I read in last Sunday’s Newark Star Ledger. It was pointed out that New Jersey was losing businesses, residents, and workers to Pennsylvania. Why? High property and income taxes, and one of the most employer-hostile environments in the nation. Just in the last year, the New Jersey legislature passed several feel good laws that once again increased the cost of operating in the Garden State, like paid leaves of absence, a highly punitive mini-WARN statute, among others. I say feel good because while everyone’s intention is good, the costs to the employer may be such that there is no longer an advantage to operating in New Jersey.

And you know what? Employers aren’t just threatening anymore, they are actually voting with their feet. One large manufacturer is shutting down its Middlesex County facility and moving to York, Pa. Another is moving out of Bergen County.

Labor and employment laws are great, especially when there are jobs and employees. Employers exist to make a product or provide a service, and if they are successful, make a profit and provide good jobs with good benefits in a clean and decent environment. We can’t hold employers responsible for addressing all of society’s ills, like the lack of child care, healthcare, eldercare, or adequate transportation. We also can’t treat employers as if they can be squeezed for more and more money.

New Jersey may have learned these lessons far too late in the game. Now it is paying the price. Too bad. I love New Jersey. I was born and raised here, and here is where I represent employers in the practice of labor and employment law.

Well, New Jersey may not be a great place to do business, but at least it can always serve as a bad example!

Jed

Welcome to my blog. I’m a Labor and Employment attorney who’s been representing employers for 25 years, and I’ve loved every minute of it. No, I don’t think unions are bad, but neither are employers. In my experience, most employers try hard to comply with highly complex labor and employment laws, many of which are difficult to understand. In fact, I am often surprised by the high level of compliance that employers actually achieve. My own sense of things is that many of these laws and regulations are written and enacted as if everyone works for a mega employer like IBM or UPS, with a phalanx of lawyers and HR professionals making sure that all laws and regulations are enforced with absolute perfection. Not so. It’s often easy to forget that most of us work for small employers, with fewer than 400 employees.

So, where do I stand on most labor relations issues? I believe that employees have workplace rights that must be respected. But I also believe that employers also have rights which must be respected, among them the right to operate their businesses without unnecessary interference. In the area of union organizing, for example, just as employees have a right to freely express their views on unions, so do employers, and it ought not be government’s role to prohibit employers from lawfully speaking out against unionization.

This of course, leads me to a short discussion about a new U.S. Supreme Court case, Chamber of Commerce v. Brown, in which the Court held that a California law that prohibited employers who received state funds from “assisting, promoting, or deterring” union organizing. Because of the strong financial penalties for violating the statute, employers had a strong incentive to remain silent during a union campaign, which, of course, was exactly that purpose of the law. The Court held that the statute was preempted by the National Labor Relations Act, observing that States may not regulate labor related conduct that Congress intended to be regulated by the free play of economic forces. Such absence of regulation was exactly what Congress intended with respect to noncoercive employer speech regarding unionization.

This is a decision that’s good for employers and employees. It ensures that employees will hear all sides and get all the information they need to make an informed choice. Employees aren’t stupid; they can listen to all sides of a debate and make intelligent choices. If a union is right for them, they’ll vote for one; if it’s not, gagging the employer is not going to make a difference, at least not in the long run. Remember, employers have free speech rights, too.

Anyway, that’s my opinion.