Friday, December 18, 2009

EEOC Announces New "EEO Is The Law" Poster

The United States Equal Employment Opportunity Commmission ("EEOC") has revised its “Equal Employment Opportunity is the Law” poster. This new version reflects current federal employment discrimination law, including the Americans with Disabilities Act Amendments Act of 2008 and the Genetic Information Nondiscrimination Act of 2008. The revised poster also includes updates from the Department of Labor.

Information on this poster and EEOC requirements can be found at

Wednesday, December 16, 2009

DOL Sues Connecticut Company for Failing to Remit 401(k) Contributions

The U.S. Department of Labor ("DOL") has sued Manchester Moving and Storage Inc., a Manchester, Connecticut based company, as well as company president Frank N. Serignese for alleged misuse of more than $36,000 belonging to the employees of the company's 401(k) plan. The lawsuit, filed in the federal court in Connecticut, alleges that Serignese and the company violated ERISA by failing to remit to the plan employee contributions and participant loan repayments. The company was the plan sponsor and plan administrator, while Serignese served as the plan's trustee. Both were fiduciaries to the plan with responsibility for collecting money and property owed to the plan, which was funded primarily through contributions withheld from employee paychecks. The DOL's suit alleges that the defendants collected and used for the benefit of the company $31,709.94 in employee contributions and $4,318.21 in loan repayments belonging to the plan.

DOL Sues Virginia Company For Abandoning 401(k) Plan

The U.S. Department of Labor ("DOL") has filed a lawsuit to obtain appointment of an independent fiduciary to oversee the 401(k) plan of Global System Enterprises Inc., a defunct company formerly located in Arlington, Virginia. The company managed the plan until May 2005 when it ceased operations. Since that time, no one has taken fiduciary responsibility for the operation and administration of the plan and its assets. As a result, the plan’s participants and beneficiaries have been unable to gain access to or information about their individual balances. The suit, Solis v. Global System Enterprises Inc., Civil Action Number: 1:09-cv-01351-LMB-IDD, was filed in federal court in Virginia and seeks to appoint an independent fiduciary to terminate the plan and distribute plan assets to participants and beneficiaries.

DOL Issues Advisory Opinion Regarding "Target-Date" or "Lifecycle" Mutual Funds

On Decemmber 4, 2009, the United States Department of Labor ("DOL") issued Advisory Opinion 2009-04A, addressing the issue of whether the assets of "target-date" or "lifecycle" mutual funds constitute "plan assets" of employee benefit plans which invest in the funds. The DOL also addressed the issue of whether the funds' investment advisers would be considered fiduciaries of the investing employee benefit plans under ERISA. In answering these questions, the DOL assumed that the Funds are investment companies registered under the Investment Company Act of 1940. The DOL noted that, under Section 3(21)(B) of ERISA, the investment of an employee benefit plan in a registered investment company does not, by itself, cause the company or its investment adviser to be a fiduciary (or a party in interest) of the investing plan for purposes of Title I of ERISA. In the DOL's view, nothing in ERISA Section 3(21)(B) or Section 401(b)(1) suggests that a registered investment company's investment in the shares of affiliated mutual funds would, by itself, affect the application of those sections of ERISA. According to the DOL, the fact that a fund's assets consist of shares of affiliated mutual funds does not, by itself, make the assets of the fund "plan assets" of an employee benefit plan which invests in the fund, or make the fund's investment advisers fiduciaries of the investing employee benefit plan under ERISA.

Here is the link to the Advisory Opinion Letter

NY Governor to Sign Gender Identity Executive Order

New York Governor David Paterson will sign an executive order today to extend anti-discrimination protections to transgender state employees. Governor Paterson is scheduled to sign the order this morning at the Lesbian, Gay, Bisexual, and Transgender Community Center in Manhattan. A number of cities, including Buffalo, Albany, Rochester and New York City, already prohibit workplace discrimination on the basis of gender identity or expression. More comprehensive legislation to outlaw discrimination based on gender identity has passed the Assembly but awaits action in the Senate.

Tuesday, December 15, 2009

Supreme Court to Hear Employee Text Messaging Case

The United States Supreme Court agreed to hear today a case appealed by the city of Ontario, Calif., and its police department — a case involving the blackberrt hand-held communication device. The petition tests whether there is a constitutionally-based right of privacy in text messages for employees of a government agency and, if there is such a right, whether it is less extensive for city employees using government-owned electronic pagers. The case involves the city of Ontario, California's review of text messages that a member of a police SWAT team had sent to another officer with whom he was having a romantic affair, and also messages he had sent to his wife. The Court'a decision in thia case likely will involve the examination a 1987 decision of the Court, Connor v. Ortega, which recognized some workplace privacy for public employees, but at the same time counseled that courts should take into account the "operational realities" of the workplace.

EEOC Launches Guides In Effort To Increase Federal Hiring of Individuals with Disabilities

Advancing its campaign to increase federal hiring of employees with disabilities, the U.S. Equal Employment Opportunity Commission (EEOC) has issued a set of guides on leveraging Schedule A, an authority available to federal agencies to hire and/or to promote individuals with disabilities without competing the job. The five “ABCs of Schedule A” guides are tailored for each participant in the federal hiring process: Service Providers, Applicants with Disabilities, Human Resources Professionals, Hiring Managers, and Disability Program Manager and/or Selective Placement Coordinator. The EEOC determined that the guidance was necessary because, according to the Agency, the participation rate of individuals with severe disabilities in the federal workforce continues to decline. All five guides are available on the EEOC’s web site,, and can be immediately downloaded and printed.

Tuesday, December 8, 2009

EEOC Sues Brooklyn Fishery for Racial Harassment

The EEOC filed suit Monday against a family-run fishmonger in Brooklyn charging bosses with racially and sexually harassing male employees. The suit, filed in federal court in Brooklyn, NY, says black workers were subjected to racial jokes and slurs. The lawsuit also alleges that managers at the fish business regularly grabbed and pinched male employees' buttocks and frequently jabbed fish hooks into male employees' buttocks.

Read more:

Monster Settles ERISA Class Action Lawsuit

A federal judge has granted preliminary approval toward a $4.25 million settlement between Monster Worldwide Inc., which owns the popular job-search Web site, and a class of plaintiffs alleging the company and its executives breached their fiduciary duty by artificially inflating stock prices to the detriment of employees' retirement plans, a practice sometimes referred to as backdating.

Backdating takes place when executives change the award date of previously granted stock options in shares of their own company so that their securities are worth more. The backdating issues at Monster Worldwide resulted in the criminal convictions of two former senior officials. Monster recently agreed to pay $4.25 million to a group of employees who held Monster stock in their 401(k) plans. These employees sued alleging violations of ERISA and contending they had bought shares in their 401k plans while their bosses -- Monster Worldwide executives -- made false disclosures about Monster's financial condition and illegally lined their pockets with back-dated stock option grants.

Judge Alvin Hellerstein of the U.S. District Court for the Southern District of New York on Thursday granted preliminary class certification and preliminary approval of the settlement.

Applicant for Employment Accuses McDonald's of "Transgender" Discrimination

A transgender teen in Orlando has filed a complaint against McDonald’s after a manager refused to interview her and subsequently left a message on her answering machine containing a common epithet. Zikerria Bellamy applied for a job at McDonald’s in July and left the box on her application for gender blank. The online application specifically says that field is optional, but when she arrived for an interview, the manager insisted she fill in the field. After checking the box that said “Male”, he terminated the interview. Zikerria returned a second time to try speaking to a different manager who also refused to speak to her and then followed up with a message on her voice mail (see below).

The Transgender Legal Defense & Education Fund has filed a complaint with Florida’s Commission on Human Relations on Bellamy’s behalf, claiming that McDonald’s violated the Florida Civil Rights Act. Florida law does not explicitly prohibit employment discrimination on the basis of sexual identity or sexual orientation, but administrative agencies have in the past ruled that the sex and disability provisions of the Florida Civil Rights Act protects transgendered individuals.

Tuesday, December 1, 2009

DOL Releases Updated Employment Law Guide

The U.S. Department of Labor today announced the availability of an updated version of its popular Employment Law Guide, an online publication that describes the major employment laws administered by the department. The Guide helps the public — workers and employers — understand many of the laws affecting the workplace. For instance, it helps small businesses develop wage, benefit, safety and health, and nondiscrimination policies. It also benefits employees and employee representatives who need information about worker rights and responsibilities under federal employment laws.

Following a topical format and written in plain language, the Employment Law Guide is especially helpful for employers without a dedicated legal or human resources staff. The updated version addresses recent and important changes in employment laws, including the increase in the federal minimum wage and an expansion of the Family and Medical Leave Act that grants qualified relatives of veterans leave to care for ill or injured uniformed service members or to fulfill obligations that arise when a relative is called to active duty in the military. The Guide also now includes a chapter on child labor regulations in the agriculture industry and one on the Defense Base Act, which provides workers' compensation benefits to civilian employees working outside the United States on U.S. military bases or under certain contracts with the U.S.

The updated Employment Law Guide is available at or

DOL to Crack Down on Untimely 401(k) Contributions

The Employee Benefit Security Administration (EBSA), the division of the Department of Labor (the DOL) that oversees employee benefit issues, has set out its priorities for 2010. Topping that list is the timely remittance of employee contributions to retirement plans. While the DOL has penalized employers in the past for being slow to remit elective deferral contributions to its 401(k) plan trusts, Assistant Secretary of Labor Phyllis Borzi, the new head of EBSA, intends to get even tougher. Criminal investigations and prosecutions are not new. However, Borzi's September 14 speech at the 2009 ASPPA/DOL Speaks conference signals that the EBSA is prepared to take an even stronger stance on untimely remittances than in the past, at least in some circumstances. Employee contributions (such as elective deferrals to 401(k) plans) must be remitted by the employer to the plan as soon as such contributions can reasonably be segregated from the employer's general assets. The DOL has typically expected the remittance to the plans to be made within a couple of days after the tax deposits are due for the same payroll. A late deposit has always been considered a breach of fiduciary duty and a prohibited loan to the employer, giving rise to possible sanctions such as excise taxes, penalties and liability for lost earnings to the participants. Now, at least in “egregious” cases, the DOL will also consider criminal sanctions.