Pennsylvania Employment Lawyer & Attorney : Russell Krafft & Gruber Law Firm : Lancaster, York, Harrisburg

In response to heavy lobbying by the Pennsylvania Newspapers Association, Pennsylvania enacted legislation overhauling what was largely regarded as one of the worst open records laws in the country.   The “Right-to-Know Law” is generally effective January 1, 2009, and applies to the public records of state and local agencies, the state legislature, municipalities and the judicial system. All records are presumed to be public records unless subject to specific exemption, protected by legal privilege or exempt by regulation or judicial order. The exemptions applicable to employment related public records are as follows:

• Medical, psychiatric or psychological records;
• Personal identification information like social security, telephone or other personal financial information except that a government employee’s name, position, salary and employment contract are not considered personal identification information;
• Employment records including the following:
  • Reference letters and recommendations;
  • Performance reviews;
  • Civil service test results;
  • Employment applications of those not hired;
  • Written criticisms of an employee;
  • Grievance material including documents related to discrimination and sexual harassment; and
  • Preliminary disciplinary or discharge information; however, the “final action” of an agency that results in demotion or discharge is a public record;
• Collective bargaining strategy or negotiations and arbitration proceedings except as to the final contract or arbitrator’s decision; and
• Trade secrets or confidential proprietary information.

The Right-to-Know Law is a big change from the prior law that protected personnel records. Salaries of Pennsylvania’s public employees were not subject to disclosure under the previous open records law leading to great speculation about Penn State Coach Joe Paterno’s salary.   Had the secrecy of JoPa’s salary not been resolved by a 2007 lawsuit, it would have been subject to disclosure under the new law. By the way, his salary is around $500,000.

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Many managers view the efforts of HR to bring order to the hiring process as meddlesome, bureaucratic and dilatory. “Just find me someone to fill this position” is the usual approach. There are several things that an HR generalist can bring to the table in terms of education and organization without slowing the process:

Uniformity of Process: Companies should develop an interview process and follow it. Haphazard hiring practices are difficult to defend from discrimination claims. Every interview process includes the following actions:

• Identify in writing the minimum qualifications of the position and review the job description.
• Establish criteria for an “applicant” including whether you will consider unsolicited resumes, internet inquiries, and recruiter referrals.
• Identify the qualified applicants and the process for selecting the most qualified.
• Develop a base set of job related questions for interviewers.
• Develop a simple applicant assessment form.
• Document the reasons for selection of the successful candidate.
• Make sure the process is followed.

Documentation:   In response to any government investigation or as part of discovery in litigation, an employer will be required to turn over its written documentation of the hiring and interview process. To the extent possible, I recommend controlling the documentation that is created so that there are no smoking guns. Many legitimate hiring selections are called into question because of things that are written by interviewers in the margins of resumes. Try to review the interview forms for inappropriate comments and send them back for revision, if necessary. Furthermore, an “institutional memory” is created by written documentation that survives the departure of interviewers and other personnel.

Prohibited Questions:   Many state anti-discrimination laws and regulations prohibit certain types of employment inquiries. For example, the Pennsylvania Human Relations Act (43 P.S. Section 955 (b) (1)) prohibits employers from eliciting information or using any form of application that contains questions or entries concerning race, color, religious creed, ancestry, age, sex, national origin, past handicap or disability. Federal law prohibits asking for disability information except as part of a voluntary questionnaire under an affirmative action plan for the purpose of applicant tracking.  Otherwise, it is unlawful to discriminate and ask for medical information prior to an offer of employment under federal law.  There is not an absolute prohibition on soliciting other protected class information, but it should be done only as to a bona fide occupational qualification.

Applicant Communication:   Many organizations take a minimalist approach to communications with applicants foregoing acknowledgment of applications and rejection letters. While this correspondence may seem like a recruiting nicety, it serves a legal purpose by defining the applicant pool for a particular position.   If the parameters of consideration are not defined, enforcement agencies will look to all applicants to analyze discrimination claims.  At a minimum an employer should identify who was considered for a position and how long an individual’s application will remain active for future consideration. This exercise is very important for government contractors that may face OFCCP audits; particularly in light of the agency’s definition of “internet applicant”.

Training:   Very few managers and supervisors are good interviewers. Asking irrelevant questions, seeking unlawful information, or alienating good prospects are only some of the problems. Without training, many managers do not obtain enough information to critically evaluate the abilities of the applicants they have interviewed. Training on the interview process and techniques might prove invaluable to reducing turnover created by poor hiring decisions.

*Not meant to be an exhaustive list.

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EEO-1 reports under the new reporting format are due at the end of the month.  On line access to the form can be obtained from the EEOC website.   Filing information and technical assistance are also available on line.  E-mail extension requests can be made, but are not guaranteed.

There are several areas of change in the EEO-1 Form and some guidance on collecting information.  Employers have always faced a dilemma on how to collect the information. The EEOC previously encouraged employers to identify the race and/or ethnicity of their employees by visual inspection.   The EEOC now prefers that employers gather data through voluntarily self-reporting by employees.

The new EEO-1 Reports also have revised job categories for "Officials and Managers" by dividing it into two categories based on responsibility and influence within the organization as follows:

• Executive/Senior Level Officials and Managers (plan, direct and formulate policy, set strategy and provide overall direction; in larger organizations, within two reporting levels of CEO)
• First/Mid-Level Officials and Managers (direct implementation or operations within specific parameters set by Executive/Senior Level Officials and Managers; oversee day-to-day operations)

The revised EEO-1 also will move business and financial occupations from the Officials and Managers category to the Professionals category (to improve data for analyzing trends in mobility of minorities and women within Officials and Managers).

The new EEO-1 Report also made the following changes to the race and ethnic categories:

• the addition of a new category entitled “Two or more races”;
• the separation of “Asian” and “Native Hawaiian or other Pacific Islander” into two categories;
• the replacement of the category “Black” with “Black or African American”; and
• the replacement of the category “Hispanic” with “Hispanic or Latino.”

The revised EEO-1 Report can be found at: EEOC revised EEO-1 Report.  Additional information from the EEOC about the revised form can be found at: Q&A: Revisions to the EEO-1 Report.

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The Department of Homeland Security (DHS) issued new regulations that create a "safe-harbor" for employers who either receive a (i) no-match letter from the Social Security Administration or (ii) written notice from DHS questioning an I-9 Form. Employers who follow the protocol and timeline set forth in the regulations will not be charged with "constructive knowledge of employment of an unauthorized worker"; hence, being shielded from civil and criminal sanctions in a subsequent DHS audit. However, when one examines the safe-harbor, it clearly puts the employer in a position of terminating employees who cannot meet government requirements and time frames thereby facing discrimination claims and employee backlash.

The safe-harbor protocol requires that the employer complete the following steps within the prescribed time frames:

• Within 30 days of the letter, check employer records to determine if there is an employer error like a typo or transcribed number/misspelled name.
• If unresolved, employers must ask the employee to confirm accuracy of records. (Employers may wish to immediately inform employees about their obligation to resolve the disparity explaining that resolution of the mismatch could take time…. a lot of time).
• If the employer is able to resolve the mismatch, the employer should follow the instruction in the No-Match letter.
• If unresolved, the employer should inform the employee that the employee has 90 days from the date the employer received the No-Match letter to resolve the matter with SSA.
• If the discrepancy is not resolved within 90 days of receipt of the No-Match letter, the employer should complete, within three days, a new I-9 Form as if the employee in question were newly hired, except that no document may be used to verify the employee's authorization for work that uses the questionable Social Security number. Additionally, the employee must present a document that contains a photograph in order to establish identity or both identity and employment authorization.

Completing a new Form I-9 without reliance on the old disputed documents or social security numbers, will be difficult if not impossible. Furthermore, reliance on the government's voluntary E-verify system provides no safe harbor for I-9 compliance. If the employee is unable under such circumstances to provide satisfactory documentation, the I-9 instructions state that "employment should be discontinued."    In the case the employee provided false information but somehow manage to comply with the Form I-9 requirements the second time, the same instruction suggest an employer follow its policy on employees who provide false information.

In either case, an employer is prohibited from discriminating against applicants or employees based on their national origin. Employers must also manage the perception among employees that this bureaucratic approach to national immigration policy isn't the employer's doing. The new regulations create a "safe-harbor" from DHS prosecution and an employee relations perfect storm.

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Electronic discovery promises to be a real brier patch for employers. It has already sprouted several blawgs dedicated to e-discovery topics. There are some good resources on eDiscovery Source, Electronic Discovery Law, and Sound Evidence: E-Discovery Simplified.

I have traded a series of posts and comments with fellow lawyer and blogger Rush Nigut at Rush on Business. We have both exposed the merits of a thoughtfully developed record retention policy. We have begun to explore the "what ifs" in the context of business litigation.

Employment discrimination cases will undoubtedly have a component of electronic discovery in terms of e-mails between the "key players". When an employer has a threatened claim, it has an obligation to preserve electronic and other evidence even before a lawsuit is filed. Intentional or inadvertent destruction of this evidence can result in sanctions such as loss of the case, monetary sanctions or an adverse inference instruction to the jury. These sanctions can occur even if records were destroyed pursuant to a valid record retention policy.

For example, a recent court decision involving a common factual scenario highlights the issues involving record retention and destruction. In Floeter v. City of Orlando, a female employee filed an internal complaint of sexual harassment including allegations of pornographic e-mails. She later filed a lawsuit in which the pornographic e-mails were subpoenaed. Because of the application of a record retention policy, the employer could not produce or unequivocally state that the e-mails did not exist. After considering a variety of sanctions, the judge ruled that the jury might receive an "adverse inference" instruction which allows the employee to argue that the e-mails existed and the employer intentionally destroyed them.

The employer's predicament was caused, in part, by its record retention policy including:

• Failure to put a hold on electronic records when litigation was possible, i.e., the filing of an internal complaint.
• Failure to preserve computer records when new computers are issued or employees leave and their computers are reassigned.
• Routine erasure of back up tapes pursuant to policy.

When and employer has a threatened legal claim there are several things it should not do as demonstrated by excerpts from these real cases:

• Don't send out an e-mail reminding the IT department and employees of the company's heretofore unenforced record retention policy. Arthur Anderson took this tact and ended up in the United States Supreme Court arguing about overturning criminal convictions.

• Don’t adopt a record retention policy and schedule a Shredder Day

• Don't purchase and run software called the Evidence Eliminator

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Last week we discussed some of the new issues that arise regarding electronic records. I summarized the results of a pre-federal rule amendment case, Zubalake v. UBS Warburg. 

 

If you've decided to do your best to protect yourself from similar circumstances, consider developing and implementing a written record retention policy. Following are some things to keep in mind:

• Identify the types and sources of both electronic and hard copy documents;
• Evaluate the business need for the various types of electronic records and documents. Keep in mind that some records have mandatory retention periods.
• Determine the retention or destruction period for classes of records.
• Anticipate the arguments that may be made and inferences that could be drawn from the destruction of certain documents and weigh it against the expense of retaining and producing the documents.
• Establish a storage and retrieval system for retained records evaluating its cost and efficiency.
• Develop, communicate, and enforce a policy on record retention.
• Establish a system for placing a "litigation hold" on records when a claim is threatened, administrative claim commenced, or a law suit filed. This will protect your company against sanctions for destroyed documents.

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Most Human Resource professionals tend to be pack rats. When documentation is typically hard to come by, no one in his or her right mind would put it in the shredder. In fact, the inclination might be to keep it forever. Recent changes in court procedures may require re-evaluation of company record retention practices, particularly when it comes to "electronically stored information". It's time for all employers to get a handle on the sources of electronic information and develop a record retention policy for its preservation, production and destruction.

 

On December 1, 2006, the Federal Rules of Civil Procedure were amended to address court procedures for disclosing electronic information during the discovery phase of litigation. The new court rules begin to apply to a company when litigation is "reasonably anticipated". At that point, a company must put a "litigation hold" on its electronic and other records that may be discoverable in litigation. Companies that take this step will be protected against court sanctions, so long as they take reasonable steps to protect and preserve information.

 

Once litigation is commenced, the new rules require lawyers representing both sides to meet and discuss the production of electronic information including its format and preservation, difficulties in accessing, and costs of providing. If the company can show that the information is not "reasonably accessible" because of cost or burden, it may avoid production unless the employee can show it has good cause. A court may require the company to produce it anyway, but may require the employee to bear some of the expense.

 

Most discrimination-based lawsuit are brought in federal courts so this has a direct impact on human resources as it relates to personnel records and most importantly e-mail communications. How these issues can turn into a disaster for employers was highlighted in Zubalake v. UBS Warburg, a pre-federal rule amendment case involving a former employee's gender discrimination claims against a securities company. The former employee demanded that the company produce e-mails many of which were backed up or stored in a manner that they were not readily available without the employer incurring significant expense.

 

In order to respond to the e-mail production request, the company would have to restore and review 77 back up tapes at a cost of over $160,000.00 to restore and $100,000 to review. The court ordered the company to do so and to bear 75% of the cost of restoring and all of the cost of reviewing. After producing the some of the e-mails, the court determined that important information was missing because the company had failed to adequately safeguard and produce e-mails from a key player in the company's decision making process concerning the former employee's treatment.

 

As a sanction for its failures, the court instructed the jury that it may conclude that the e-mails that were not produced by the employer may have been deliberately deleted and could have contained information supporting the former employee's claims of discrimination. The jury awarded the plaintiff $29 million dollars in damages.

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