The Employer E-Letter: Labor and Employment Law News
from the Duluth, Minnesota law firm of
Hanft Fride, A Professional Association.
Co-Editors, Scott A. Witty, saw@hanftlaw.com and Richard R. Burns, rrb@hanftlaw.com, or 218.722.4766. Please feel free to forward this e-mail or share it with others. If there are other topics of interest to you or any other suggestions concerning this newsletter, please let us know.
- EQUAL PAY MUST BE CLOSELY SCRUTINIZED
- CHANGE IN JOB TITLE NOT ADVERSE EMPLOYMENT ACTION
- CHATGPT RISKS AND THE NEED FOR CORPORATE POLICIES
- DRINKING WHILE POSTING NOT EXCUSED BY UNEMPLOYMENT LAW JUDGE
- Tip Of The Month
EQUAL PAY MUST BE CLOSELY SCRUTINIZED
In a recent 8th Circuit case, a base salary differential of $75,000 between a woman and a man with identical titles did not create a viable Equal Pay Act claim. The female employee was able to show a prima facie case in that she was paid less for equal work on jobs requiring equal skill, effort and responsibility, and which were performed under similar working conditions. However, there is an important defense to equal pay cases, and that is that the “differential is based on any other factor other than gender.” Although on the surface the difference was $75,000 in base salary, when it came to reviewing overtime pay and bonuses, the difference was reduced to $326,526 versus $335,000. The Court stated that the pay differential was based on a difference in skill sets and experience and the desire to incentivize the female employee to grow in the position. This was sufficient to satisfy the burden of proof that the pay differential was based on a factor other than gender. Tamara O’Reilly v. Daugherty Systems, Inc., No. 21-3465 (8th Circ. 2023).
CHANGE IN JOB TITLE NOT ADVERSE EMPLOYMENT ACTION
Among other discrimination claims raised against Flint Group North America, an employee claimed that a change in job title constituted a demotion and was therefore an adverse employment action demonstrating discrimination. In October 2019, the employee was assigned additional job duties after Flint Group laid off another employee. The employee claimed his title changed from Quality Control Technician to Quality Assurance Lead at that time. Flint Group reorganized a few months later. The employee’s job title was changed to Quality Assurance Technician because the employee’s duties aligned with quality assurance more than quality control. The job duties, wages, benefits, and reporting structure remained the same. The United States District Court for the district of Minnesota concluded that, even if the title changed from “Lead” to “Technician,” a semantic change in title and a “bruised ego” do not an constitute adverse employment action, which is a required element for a prima facie case of discrimination. The rest of the employee’s claims failed as well due to insufficient evidence of discrimination against the employee by Flint Group. Kania v. Flint Group, No. 21-1845 (D. Minn. July 14, 2023).
CHATGPT RISKS AND THE NEED FOR CORPORATE POLICIES
ChatGPT (a natural language processing tool driven by AI technology – used for anything from composing emails to writing code) has recently become the talk in many industries as a potential game-changer. As with any new technology, however, ChatGPT poses new issues and possible areas of risk. Thus, companies are well advised to evaluate those issues and risks and update their policies to address them. With ChatGPT, the areas of concern are confidentiality, intellectual property, regulatory and compliance concerns and output quality and bias. Workplace policies would likely need to be updated to provide guidance to employees to avoid these concerns. It is a good idea for businesses that want to use or are using AI-related products (such as ChatGPT or Google’s equivalent, Bard) to provide guidance to employees on exactly how to use the AI (how it is allowed to be used to produce materials for the business, and when additional approval is required for other AI use). Employees would also need to know what is and is not allowed to be entered into the AI (to ensure protected materials stay protected), and the extent to which AI would be accessible by external business partners and vendors. In addition, it is important to be cautious when using an AI tool like this to evaluate resumes for hiring, or to evaluate employee performance. Any such use of AI software would need to be manually reviewed to ensure compliance with employment statutes like the Minnesota Human Rights Act, Title VII, and any other anti-discrimination laws. As the technology develops, there will likely be further issues and concerns, so while this is an incredible new business tool, it is important to remain vigilant about the risks it poses to businesses as well.
DRINKING WHILE POSTING NOT EXCUSED BY UNEMPLOYMENT LAW JUDGE
Under Minnesota’s unemployment law, an applicant who is “discharged because of employment misconduct” is ineligible for unemployment benefits. Here, the claimant was terminated because of “vulgar and inappropriate” social media posts in violation of the employer’s policies. The claimant argued that such posts were due to her “chemical dependency” on alcohol. Chemical dependency is an exception to the employment misconduct rule for unemployment benefits. However, here the Minnesota Court of Appeals determined that while the claimant had “a few drinks” prior to writing the posts on social media in question, the posts were not due to her chemical dependency, the claimant was not intoxicated when writing the posts and the claimant posted the comments with the intent to hurt former coworkers. Therefore, the exception for chemical dependency did not apply, and the claimant was not entitled to unemployment benefits. This case reminds employers that while chemical dependency can be a defense to employment misconduct, there are exceptions. Most notably, if the chemical dependency has been previously diagnosed, treatment has been attempted and the employee has failed to make consistent efforts to control the chemical dependency. Langer v. Mayo Foundation, A22-1448 (Minn. Ct. App. 2023).
At some point, every employer is faced with the difficult and sometimes tense task of disciplining, terminating, or investigating an employee for poor performance or misconduct. When meeting with employees about these topics it is important for employers to remember to ensure the conditions of the meeting are such that the employee feels free to leave because failing to do so could lead to claims of false imprisonment. To avoid this hidden trap, it is important that the employee be allowed to sit by an unlocked door that can easily be accessed by the employee. It is also important to avoid making statements or engaging in conduct that could be interpreted to mean that the employee is not free to leave.
Hanft Fride’s business and trial lawyers are located at 1000 U.S. Bank Place, in Duluth, Minnesota. Visit our website at www.hanftlaw.com for general information on the firm and our attorneys. Our employment lawyers include Tom Torgerson, Rob Merritt and Scott Witty. Richard Burns is now of Counsel.
The information provided in this E-letter is general in nature and should not be used as a substitute for professional services and advice. The communication and receipt of this information is not intended to create an attorney-client relationship. Readers should consult with their legal counsel before taking any action on matters covered in this E‑letter.
To subscribe or unsubscribe to Employer E-Letter, e-mail your request to nrs@hanftlaw.com or call Scott Witty at 218.722.4766.
Copyright 2023 by Hanft Fride, P.A. All rights reserved. Hanft Fride, A Professional Association, 1000 U.S. Bank Place, 130 W. Superior Street, Duluth, MN 55802. Phone 218.722.4766; Fax 218.529.2401.