3 hot-button employment litigation areas for 2022

Those hoping for a respite from emerging legal risks following nearly two years of a pandemic are not likely to get it anytime soon, Blank Rome attorneys said.

Employers who sent employees away from traditional offices during the pandemic have seen a "new frontier" of discrimination claims, Kaplan said. That development may be especially relevant now that many organizations are changing up return-to-work plans in light of the omicron variant's emergence.

Courts are beginning to see factual circumstances emerge involving co-workers who have never interacted with each other in person, or even in the same physical space as one another, Kaplan noted. Instead, harassment claims could involve something as simple as a message in a chat box.

"Sometimes when we're on these screens in these little boxes, we might forget that, yes, this is the same as being in the four walls of the physical office," she said. "Having training and reminders for employees on these issues is critically important."

There is more to that work, however, than simply reminding employees about what constitutes respectful workplace conduct. Certain jurisdictions, such as California and New York, may have laws on requiring employees to complete respectful workplace training that do not exist in other jurisdictions, Kaplan said. Failure to comply with those statutes could lead to fines, penalties or both.

Meanwhile, employers themselves may have other obligations to fulfill under jurisdictional anti-discrimination laws. Kaplan pointed to the example of Colorado, which has an equal pay law requiring all public and private employers employing at least one person in Colorado to disclose compensation and benefits in every job posting.

Association discrimination is another trend to keep an eye on, Kaplan continued. The Americans with Disabilities Act prohibits discrimination against an employee who is associated with someone who has a disability. But in 2021, a trend emerged in which several federal courts in five different circuits interpreted that Title VII of the 1964 Civil Rights Act similarly prohibits such discrimination.

Certain state laws already had come to the same conclusion, per Kaplan, but she said the development was nonetheless "a pretty important, new concept for employers to be aware of," in part because of the fact pattern seen in some of the cases. In one, a Caucasian employee claimed to have been discriminated against because her grand-niece was a member of a minority group. Kaplan said the court found the employee's association could be sufficient to demonstrate association-based discrimination.

"It's raised the question for me of, where is the line? Can anything be association-based discrimination?" Kaplan continued. "I think that more and more courts are going to be struggling with this issue."

Association-based discrimination also has been at the center of cases involving topical social issues both employers and employees have confronted in the past year. Another case involved a Caucasian employee who claimed association discrimination on the basis that she was a co-worker of various minority employees who wore attire containing Black Lives Matter messaging, but the court said that this was not sufficient, Kaplan said.

Still, social and political issues are likely to come into play in this context, Kaplan said, creating an opening for future potential claims.



"One thing the plaintiffs' bar loves is areas where there is not great precedent," Sandstrom said of association discrimination cases. "Uncertainty is rarely a good thing when you're on the employer side. I think that this is an area where they are going to look to expand the number of lawsuits that are out there."

Several trends have converged in the wage and hour space at present, said Anthony, including changes in the manner and means in which jobs are performed; timekeeping systems and pay practices not being regularly reviewed or audited; and payroll practices failing to calculate regular rate of pay.

"Wage and hour class and collective action claims continue to be filed at alarming rates around the country," he continued. "This is not just a California issue. It's been a national issue for many years."

Anthony detailed a list of three common types of claims employers have faced of late. The first, off-the-clock claims, typically arise in situations where employers have edits or reductions to their timekeeping systems, automatic deductions for meal breaks or similar pay practices. Employers, he said, should ensure their records properly reflect that all such practices are done lawfully, in compliance and in agreement with employees.

For example, if an employer makes automatic deductions for meal periods, but an employee works during such a period, the employee needs to fill out an exception report and report it, Anthony said. Managers may edit time records if an employee fails to clock in or clock out, but they should still have workers sign off on such edits; "The last thing we need is that our records provide evidence in a lawsuit," Anthony noted.

Regular rate cases encompass the second category of common claims. These include instances in which large groups of employees who are not exempt from receiving overtime pay receive payments in addition to their regular rate of pay, such as a bonus. Issues arise when those payments are not included in the regular rate of pay, Anthony said.



In two recent cases, employees received some form of COVID-19-related bonus or performance-based bonus. In both cases, Anthony said, the employers failed to incorporate those payments in their calculation of employees' regular rates for overtime purposes.

Lastly, Anthony cited cases involving the misclassification of employees as exempt from receiving overtime. Considerations about these groups have been altered by the pandemic, he noted, giving the example of an employer that employs a large number of outside sales workers. If outside sales workers have been asked to work remotely rather than going outside and meeting customers, the employer may need to ensure whether the workers would still be properly classified as outside sales workers.

Remote work could also pose issues with respect to final pay laws and frequency of pay laws in some jurisdictions, said Sandstrom, but that may be more of a challenge for employers that do not utilize a third-party payroll provider. "Any good third-party provider should be on top of those requirements, assuming they know where an employers' employees are working," he added.

Additionally some states have "very strict laws" regarding when a final paycheck must be provided to an employee. Sandstrom cited the example of California, where employers are required to provide final paychecks to involuntarily terminated employees on the day that the employee is terminated, unless there are calculation components, like commissions, that cannot be performed in time.

Some employers have utilized arbitration agreements to stem the tide of class and collective actions, but the strategy carries risk due to the trend of "mass arbitrations" being pursued across the U.S., Anthony said. That occurs when employees — at times numbering in the hundreds or thousands — bring arbitration claims simultaneously.

Though this type of situation can cause its own set of problems, employers that do not have arbitration agreements risk the potentially high cost involved in litigating a class or collective action, Anthony continued. 

"With some diligence, these claims are avoidable," Anthony said. "Now is a great time to review pay practices to assess potential exposure that may be on the horizon."

At press time, the Biden administration has issued three separate regulatory actions aimed at implementing or encouraging COVID-19 vaccination mandates in some way. They include President Joe Biden's federal contractor mandate; the Occupational Safety and Health Administration's Emergency Temporary Standard; and the Centers for Medicare and Medicaid Services mandate for hospitals and other healthcare facilities.

But even the OSHA mandate, perhaps the most high-profile of the regulations, may not be as influential to employers as they decide how to approach vaccination in their individual workforces.

"The real universe in what most employers care about right now is, what about private mandates?" Sandstrom said. "A growing number of employers, especially those who are trying to get back to some level of normalcy with respect to their workforce and people coming into the office have adopted, at a minimum, vaccine or test rules."

Sandstrom added that more employers are likely to consider vaccination requirements in the near future, "because it's generally seen as the best way to ensure, as far as possible, a safe workplace for those coming to work in person."

Accommodation will prove to be particularly tricky for employers with such mandates, he continued. Federal regulators have made clear that employer vaccination policies must provide a reasonable accommodation to employees who are unable to receive a COVID-19 vaccine either because of a disability or a sincerely held religious belief.

Sandstrom said employers also may encounter situations in which an employee has a temporary medical condition, which may be protected by state law, such as recovery from COVID-19 or having had a convalescent plasma or antibody treatment. "There are medical recommendations on waiting a certain amount of time to be vaccinated after those things," Sandstrom said, "and the recommendation would always be to accommodate people who in good faith are trying to be vaccinated but have some issue like that."

Pregnancy also may present a tricky situation, Sandstrom added. It has not been recognized by the Centers for Disease Control as a medical reason to delay vaccination, but some pregnant employees may feel uncomfortable proceeding with vaccination while pregnant. "Again, what we've seen is that employers are being flexible and accommodating people who reasonably have a concern relating to pregnancy," Sandstrom said.

But religious accommodation requests represent the "Wild West" of the vaccine mandate discussion, per Sandstrom, in part because of the politicization involved.

"Many people see the idea of claiming a religious exemption as almost a golden ticket from vaccination," Sandstrom said, "because there's this view [that] as long as I play the religion card, my employer is not even going to dare tread into those waters and I will get the exemption."

That makes it all the more important for employers to determine a strategy for distinguishing between legitimate religious exemption requests and those that are not, Sandstrom continued. Though difficult, he said employers could require all religious accommodations to be put in writing and follow up with those asking for such accommodations with a questionnaire that addresses topical issues, such as the employee's previous vaccination history.

"I generally advise clients [that] if it's a close call, you have to take a position with respect to how you're doing close calls," Sandstrom said. "You need a consistent approach with close calls, because otherwise you're just going to get wrapped and tied in circles, and people are going to try and play off conflicting decisions when, inevitably, there are claims brought about."

There is also the question of whether an accommodation request poses an undue hardship on the employer, the standard for which is "far less stringent" under Title VII compared to the ADA's standard, Sandstrom said. Legitimate reasons for denying such an accommodation may include having situations in which employees work in close proximity to one another and cannot be separated out, as well as situations in which employees work on-site at another contractor or employee's location and that party has a flat rule on vaccinations.

"It's something worth considering, and I think there is a reasonable number of situations where there may be undue hardship," Sandstrom said. "Employers have actually done remarkably well in court in the past month or so in raising undue hardship as a defense to employees who are claiming that full vaccine mandates impose on their religious rights."