Archive for February, 2017

As Damages Rise in Harassment Claims, EEOC Issues New Guidance

Mid adult manager wagging his finger at office worker calling up documents contain company results .

Juries are handing down larger and larger judgments in bullying and sexual harassment lawsuits against employers.

The stakes are high for any company that does not take complaints about harassment and bullying seriously and nip it in the bud if detected.

And now the stakes could become even higher after the Equal Employment Opportunity Commission proposed new guidance on preventing, identifying and eradicating workplace harassment.
The proposed guidance, if enacted, will likely give the EEOC more ammunition when pursuing harassment complaints against employers.
Under the proposed rules, employers are urged to take active steps to minimize “known or obvious risks of harassment” and failure to do so could make it difficult to defend the case.
In other words, while employers should respond promptly to harassment allegations, the EEOC says they actually have a duty to address conduct before it rises to a level at which the employer has to take action.

The proposed enforcement guidelines also require employers to take all complaints seriously and address them with prompt and thorough investigations.

All employers should have policies in place that allow employees to easily file complaints about harassment and not be fearful of losing their jobs for making the reports.

With the new guidance, the EEOC will not only look at how the employer is moving to correct the harassment, but also what it should have done to head it off before it became a problem.


Additional nuance

There is also another nuance in the guidance. As you know, Title VII of the Civil Rights Act of 1964 prohibits discrimination based on any protected characteristic like race, national origin, religion, sex, age, disability and gender.

Under the proposed guidance, the EEOC would recognize claims for harassment based on the perception that an individual has a particular characteristic, even if that perception is incorrect.

Also, any bases for a harassment claim would also create a right of action for an associational discrimination claim. That is, the EEOC recognizes claims of harassment based on association with individuals outside the complainant’s protected class.

The commission also indicates in the proposed enforcement guidance that harassment based on the intersection of two or more protected classes (for example, race and gender) is prohibited.

The proposed rules also set for the thresholds for:

  • Bringing hostile work environment claims
  • Causation standards
  • Holding an employer liable for hostile work environment claims
  • Systemic “pattern and practice” harassment claims


The guidance also sets forth five “promising practices,” which the EEOC characterizes as core principles for employers to employ in preventing harassment in the first place.

  • Committed, engaged leadership
  • Consistent and demonstrated accountability
  • Strong and comprehensive harassment policies
  • Trusted and accessible complaint procedures
  • Regular, interactive training tailored to the audience and organization


The EEOC notes that instituting these practices alone is not a defense against harassment claims, but if they are in place, the agency can better discern whether you have a culture that would reduce the chances of harassment occurring in the first place.

After the proposed guidance is finalized and enacted, it will replace the sexual harassment section of the current EEOC Compliance Manual.

Also, while the new guidance does not have the full force of a regulation, it can be useful for you to understand how the agency will investigate and potentially litigate harassment claims.


What you can do

  • Implement and regularly update your anti-harassment and discrimination policies, and ensure they are accessible to and understood by all employees.
  • Hold anti-harassment and discrimination training for all staff members.
  • Have clear procedures for making complaints without fear of retribution.
  • Use best practices when investigating claims.
  • Ensure appropriate conduct is role-modelled by management.


Respond quickly and effectively to harassment, discrimination complaints

A businesswoman shouts through a megaphone and points up towards a much larger businessman who is standing over her.

Employers need to respond swiftly when employees complain about discrimination or harassment and the response must be effective, a U.S. District appeals court has held.

When a company addresses workplace it is responsible for ensuring that its solution will stave off further harassment or discrimination, a court of appeals has held in a case of a father and son who were eventually fired after complaining about harassment.

The case illustrates the need for an employer to not only act swiftly to respond and investigate claims of harassment or discrimination, but also to ensure that any remedies that are put in place are effective. Barring that and if the harassment or discrimination resumes, an employer could be opening itself up to a possible lawsuit.

In the case of Efrain Reynaga v. Roseburg Forest Products, the 9th District Circuit Court of Appeals held that a Hispanic millwright’s discrimination case against his former employer should go to trial and the court overturned a motion for summary judgment.


What happened

The case involved a father and son who worked as millwrights for Roseburg Forest Products and they were reportedly the only Hispanics working at the site.

The father claims they were regularly subjected to verbal abuse and derogatory comments from the lead millwright and harassed them, including comments like “minorities are taking over the country” and asking if “all Mexican women are fat.”

They also say they were regularly assigned dirtier, harder and more dangerous jobs than their white counterparts. When hostile work environment worsened, the father complained.

The company took action and rearranged the supervisor’s schedule so that he would not work the same shifts as the father and son.

But one day when they showed up to their shift, their old supervisor was there they immediately left the premises. They told their new supervisor they would not work with their old boss and they were promptly suspended and the father was later fired.

Reynaga sued Roseburg for hostile work environment, disparate treatment, and retaliation. The lower court granted the employer’s motion for summary judgment and threw out the case, but the appeal’s court decision reversed that decision, which means the case can go to trial.


The decision and why it’s important

The appellate court, in making its decision, said that a jury could find the termination retaliatory, saying that the termination for missing one-and-a-half shifts was widely out of proportion to the company’s “benign treatment of [the supervisor].”

“Efrain’s prima facie case is strong, particularly in light of the timing of the termination. Efrain had worked at Roseburg for more than five years, yet he was fired barely one month after making a formal written complaint. Proof of a causal link between Efrain’s complaint and his termination-as evidenced by temporal proximity-is certainly relevant to an evaluation of pretext.”


The takeaway

If you have had an employee legitimately complain about a hostile work environment, harassment and discrimination, you should:

  • Move quickly to investigate and address the issue if you find the complaint to be valid.
  • Ensure that the action you take is effective.
  • Don’t retaliate against employees for complaining about harassment or discrimination.


Remember, harassment and discrimination cases that go to trial can be costly in terms of litigation expenses, but also any potential judgments and penalties. The final level of protection is employment practices liability insurance.

Talk to us if you want to know more about this coverage.

Report, Investigate Near Misses to Improve Safety

Man nearly steps on a banana peel on a city street.

One of the most important workplace safety tools that you can put to use is the reporting of near misses and correcting the factors that led to such a close encounter.

A near miss is an event that could have led to a workplace injury, illness or death. While you are not required to report near misses to your insurer, you should be taking note of them as they can help you identify deficiencies in your workplace safety protocols.

You should use near misses as the starting point to conduct inspections that could help you prevent a real workplace injury in the future. But you can’t investigate what you don’t know, and it’s crucial therefore that your staff report such events.

Investigating near misses is part of any successful workplace safety management program and you should make the process for reporting them easy and without ramifications for the reporting employee.


What is and isn’t a near miss

An OSHA factsheet defines a near miss – or close call – as an incident in which no property was damaged and no workers were injured, but where, given a slight shift in time or position, damage or injury easily could have occurred.

The factsheet stresses that although near misses cause no immediate harm, they can precede events in which a loss or injury could occur.

You should resist the urge to chalk the near miss up to just luck or bad luck, because a series of events or lack of precautions would have led up to the close call.

Typically, near misses are the result of a faulty process or management system and it should be your goal to investigate and find out where the breakdown occurred and what you can do to improve it.


A near-miss program

Near-miss reporting is vitally important to preventing serious, fatal and catastrophic incidents that are less frequent but far more harmful than other incidents.

The National Safety Council recommends that the following should be part of your safety program:

  • Clearly define “near miss.”
  • Establish a reporting system that reinforces the notion that every opportunity to identify and control hazards, reduce risk and prevent harmful incidents must be acted on.
  • Investigate near-miss incidents to identify the root cause and the weaknesses in the system or employee action that resulted in the circumstances that led to the near miss.
  • Use investigation results to address the failure that led to the near miss and to improve safety systems, hazard control and risk reduction.
  • Use the lessons learned and your new protocols in employee safety training.


Reporting system

One of the key aspects of a near-miss program is reporting. Most importantly, you want to encourage your workers to report such incidents because often they may occur out of sight from a supervisor or manager.

You should put out clear instructions for all personnel on how to report near misses, including whom to report to. Create forms that detail the events, what happened and why they think it constituted a near miss.

Make sure to not assail any worker reporting a near miss. Encourage your personnel to report near misses without fear of retribution or being blamed.

Avoid thinking in terms of whom to blame when investigating a near miss and instead focus on what precipitated it.


Case studies

LESSONS LEARNED – A manufacturer uses event and near-miss analysis to head off future incidents. It uses an event system that records the near miss, including detailed information on what led to the close call and what lessons can be learned from the event. Those lessons are shared throughout the organization.


IMMEDIATE ACTION – A chemical manufacturer tracks lower-level claims and near misses to identify areas where more significant injuries are likely to occur. The company encourages employees to take action to resolve issues on a temporary basis until permanent controls can be implemented.

Republicans Consider Fixing ACA, Not Repealing It

Pandoras box and scull smoke

The steamroller everyone expected from President Trump and the GOP-led Congress to flatten the Affordable Care Act has been put on idle and what was a promised quick outright repeal has morphed into a plan to “repair” the law.

In particular, Republican lawmakers, huddling while trying to devise a repeal-and-replace plan, have instead found that it won’t be so easy, unless they want to cut off millions of people from the health insurance they have purchased on exchanges.

They are most concerned with the political fallout should that happen, not to mention the fact that a repeal would also do away with the Medicaid expansion that has ensured that millions more low-income earners are covered.

With everything in flux now, as we mentioned earlier, it’s best to continue complying with the ACA as it still is the law of the land and it’s looking more and more likely that the law won’t be repealed, but will be changed. And lawmakers have indicated that they may have a fix on the table by the end of the year.

Top GOP lawmakers have publically stated that some parts of the law will remain intact and others will be “fixed.”

Surprisingly, the Republican leadership’s views on the subject will now likely align more with Democrats who have acknowledged the flaws in the law and that amending the law is the best way to go.

While conservative and Tea Party Republicans say the law can’t be fixed and should be repealed, their desired outcome is looking less and less likely. Also, there is no consensus within the GOP on what should come next.

Members of the conservative House Freedom Caucus held a press conference on Feb. 7 saying that Republican legislators should not go soft on their promise to repeal the law and instead should quickly introduce new legislation that would repeal the ACA.

They want to model the bill after legislation that Congress passed but President Obama vetoed – in 2015. That legislation would have repealed the mandate that individuals have health coverage and that companies with 50 or more employees provide employees affordable insurance.

It also would have ended federal subsidies to help people afford insurance under the ACA and scrapped funding for Medicaid expansion. It also gave lawmakers two years to come up with a replacement plan.

But it’s the leadership that decides which bills move forward and out of committee.

For now, Republicans are up against a self-imposed deadline after they passed a measure in January that allowed them to begin putting together a budget process that will undo parts of Obamacare.

Under that deadline, four congressional committees were supposed to have drafted legislation repealing the law by Jan. 27, however no bill was introduced. Now pundits say that may not happen until April.

Republicans are now considering four drafts, language from which they will likely fuse into one bill.

Without Democrats, Republicans are limited in how much they can undo the law.

Congress will have to walk a delicate path and find ways to help middle-class Americans, some of who have complained about high and skyrocketing insurance premiums. Others are worried about repeal because the ACA has given them access to life-saving treatment.

Also, there are other forces at play, including stakeholders like businesses, health insurers, drug companies and the medical industry, which all have their own agendas and will be lobbying hard.

For now, continue complying with the law and cover your employees if you are an applicable large employer – and file your papers with your staff and the IRS on time.

Baseline Health Tests Can Shave Workers’ Comp Claims Costs

Digital Tablet with X-ray and Stethoscope

More employers are testing new hires in physical jobs to establish a baseline in case they ever file a workers’ comp claim down the road.

The aim is to establish what physical ailments and pain the new hire already has, so if they are injured you can find out if they aggravated an existing injury or it’s just an existing injury that’s flaring up. And if done correctly, baseline testing doesn’t infringe on the worker’s rights or health privacy.

Baseline testing should not be confused with physical evaluations that are conducted after a job offer, but prior to placement, to ensure the new hire doesn’t have physical constraints that would keep them from performing their job. The data in a baseline evaluation cannot be used for that.

In fact, the data collected in baseline testing is kept sealed from the employer.


How it works

Baseline testing is best conducted on workers in physical jobs.

Baseline tests measure the signals traveling in the nerves and muscles, and include the use of electromyography. The tests are non-invasive and often include range-of-motion testing.

Employers that send their employees for testing cannot view the test results unless the information is needed to confirm or refute a subsequent injury.

If a worker files a claim for a soft-tissue or repetitive motion injury, the employer can order a second test, which will be used by the insurance claims adjuster or treating physician to compare to the baseline test. If there is no change in pathology, the claims administrator can deny the claim and the chances are high it won’t be contested.

To avoid problems with singling out specific workers or disabilities, you should perform this testing on the entire workforce – or at least in all of your physical jobs.

Under the law, you can order baseline testing at any time on any employee, and not just when they are hired.

The good thing about the testing is that it can identify legitimate claims. Since there is a baseline, when doctors compare and see a change in pathology, they can order treatment and workers’ comp insurance pays for it and the worker’s time away from work.

On the other hand, a second test can show irrefutable evidence that there was no chain in pathology and so the injury that the worker is claiming is likely not work-related.



Anecdotally, employers that use baseline testing see tremendous results in their workers’ comp claims.

According to an article in <i>Business Insurance</i>, Wisconsin-based Marten Transport since starting baseline testing in 2015:

  • Has seen its rate of soft-tissue injury claims for new hires drop from 3.3 per 100 new hires to 1.4.
  • Has had only three of the 37 claims filed by new hires in their first six months showing actual injuries beyond soft-tissue pain that was documented when they began working.


Marten Transport conducts the tests as part of its employment agreement and uses a third-party company to carry them out.

The non-profit organization, the Gatesway Foundation, started using baseline testing by contracting with California-based Emerge Diagnostics to rein in its spiraling workers’ comp costs.

It had been experiencing a high share of work-related musculoskeletal injuries (soft-tissue) claims, like injuries to muscles, tendons, ligaments, joints, cartilage and spinal discs.

The year prior to implementing baseline testing, the foundation’s developed claims losses were $1 million. In the first six months of the next policy year, prior to implementing the program, the foundation’s developed losses were $500,000 but, in the latter half of the year – after implementation – losses had dropped to $30,000.

Overall, it reduced claims costs by $316,544 and the program cost $9,200 – a return on investment of 3,441%.


The takeaway
As mentioned, workers in physical jobs are the best candidates for baseline testing. That includes both light and heavy manufacturing, construction, agriculture, cleaning services and movers, to name a few.

But it could also be applied to any job that involves any type of repetitive motion, even without physical exertion.

IRS Targets Employers Who Fail to File ACA Forms

Film Noir style gangster/detective hiding behind a brick wall

The IRS has started sending letters to some employers asking them where their Affordable Care Act returns are, according to the National Association of Health Underwriters.

The letters, says the association, appear to be one of the first efforts by the IRS to enforce the employer responsibility requirements of the ACA.

Under the ACA, applicable large employers (ALEs) – those with 50 or more full-time and full-time-equivalent employees – are required to file Forms 1094-C and 1095-C with the IRS. The requirement started in 2016 when those employers for the first time had to file these forms with the IRS.

The letters are for the 2015 policy year and the IRS requires that employers respond to the letter within 30 days. These letters are being sent out because the IRS did not receive the forms from some employers it has deemed as ALEs.


Letter 5699

The document the IRS sends out is Letter 5699, titled “Request for Employer Reporting of Offers of Health Insurance Coverage (Forms 1094-C and 1095-C)”.

The letter, which will be signed by a tax compliance officer, is a notification that the recipient employer is non-compliant with Internal Revenue Code (IRC) Section 6056 because the IRS has not received 2015 returns.

IRC Section 6056 requires applicable large employers to file ACA information returns with the IRS and provide statements to full-time employees relating to the health insurance coverage, if any, that was offered to them.

Employers can respond by attesting that they:

  • Were an ALE for calendar year 2015, and have already filed Form 1094-C and Form 1095-C.
  • Were an ALE for calendar year 2015, and include the forms with the response letter.
  • Were an ALE for calendar year 2015, and state that they will file the forms with the IRS.
  • Were not an ALE for calendar year 2015.
  • Had other circumstances (must explain).


If ALEs do not comply with IRC Section 6056, they can be assessed penalties.


The takeaway

If you have not gotten your paperwork in order and are also prepared to file the required documents for 2016, you should make sure you file on time.

The letters are an indication that the IRS is preparing to assess fines.

The IRS is monitoring non-compliance and has dedicated caseworkers (tax compliance officers) handling this process. The next step will be penalty assessments.

Finally, if you have not yet filed for 2015, you can still do so – and avoid the risk of incurring a late penalty of $530 per form.


New Slip, Trip, Fall Prevention Rules for General Industry

A Caucasian, female office worker climbing on a ladder trying to reach for a box on a shelf.  She wears a black outfit from top to bottom and has brown hair.  She stands on a ladder that is a bit too short and leans forward dangerously trying to retrieve the box.  The shelf has several compartments with the same box in each compartment.  There is a wall and large glass windows on the left, behind her.  There is a white ceiling above her.  The floor of the office is out of view.

Federal OSHA implemented a new rule on Jan. 17 that is aimed at reducing slip, trip and fall hazards in the workplace.

The revisions are aimed at tackling one of the main causes of worker deaths and injuries in American workplaces by applying rules designed for the construction and manufacturing sectors to other general industries.

They add requirements for personal fall protection systems and eliminate existing mandates to use guardrails as a primary fall protection method. They also allow employers to choose from accepted fall protection systems which type they want to use.

The new standard will prevent some 30 workplace deaths and more than 5,800 injuries every year, OSHA says.

While the rules will have little impact on construction and manufacturing, management in other industries needs to bone up on the rules to ensure companies are in compliance.

The most significant update to the rules allows employers to choose the fall protection system that is most effective for them and based on a variety of acceptable options, including the use of personal fall protection systems.

The agency has allowed the use of personal fall protection systems in construction since 1994, and the final rule adopts similar requirements for general industry.

The final rule also allows employers to:

  • Use rope descent systems up to 300 feet above a lower level.
  • Prohibit the use of body belts as part of a personal fall arrest system.
  • Require worker training on personal fall protection systems and other equipment designed for falls.


OSHA says it tried to align fall protection requirements for general industry “as much as possible” with its requirements for construction because many employers perform both types of activities.

The final rule for general industry updates requirements for ladders, stairs, dockboards, and fall and falling object protection.


Key provisions

Fall protection

An employer’s obligation to provide fall protection is triggered when employees work at least four feet above a lower level.

The final rule requires employers to select one or more of these options, depending on the particular situation or activity:

  • Guardrail system
  • Safety net system
  • Personal fall arrest system (body belts now prohibited)
  • Positioning system
  • Travel restraint system
  • Ladder safety system (does not include cages or wells)
  • Handrails
  • Designated areas (only permitted on low-slope roofs)


The rule establishes fall protection options and other requirements for some specific situations like hoist areas, runways, wall openings, repair pits, and stairways.


Ladder safety

The final rule sets out general ladder safety requirements applicable to fixed ladders, portable ladders, and mobile ladder stands and platforms.

Employers must ensure that:

  • Ladders are capable of supporting at least the maximum intended load, i.e., the total weight and force of anticipated employees and equipment or other materials.
  • Mobile ladder stands and platforms are capable of supporting four times the maximum intended load.


Ladders must be inspected before initial use during a work shift, and as necessary, to identify visible defects that could cause worker injuries.



Employers must ensure training of workers who use personal fall protection or work in dangerous circumstances, including working on loading docks. Workers must be trained by a “qualified person,” and the training must be understandable to employees and cover:

  • Identification of fall hazards.
  • Proper use of personal fall protection systems.
  • Maintenance, inspection, and storage of equipment or systems used for fall protection.


Employers must also ensure the retraining of workers when they have reason to believe workers lack the required comprehension and skill.