EMPLOYMENT LAW
The Commonwealth is undergoing an intense period of change with respect to employment law and its interpretation by the legislature, courts, and administrative agencies. This changing landscape has raised several emerging issues, which can pose significant risks to employees, small business proprietors, and mid-sized and larger corporations. Without attempting a full legal analysis of each of these developments, we will endeavor to provide a brief synopsis of the recent developments in employment law.
INDEPENDENT CONTRACTOR STATUS IS DIFFICULT TO ESTABLISH IN MASSACHUSETTS
In 2004, the Legislature amended the Independent Contractor Law-G.L.c. 149, § 148B, making it more difficult for employers to classify workers as independent contractors in order to avoid costs associated with overtime pay, employee benefits, unemployment benefits, and workers’ compensation. A recent Superior Court opinion addressing independent contractor status in the Commonwealth is again narrowing the number of individual workers who can truly be treated as independent contractors.
In Amero, et al. v. Townsend Oil Co., et al, Judge Thomas R. Murtagh ruled that an oil delivery company had wrongly classified a driver as an independent contractor even though he provided his own truck and incorporated his own company in order to limit his liability. The plaintiff driver prevailed in proving that the law required that he be classified as an employee, because his services fell within the core business that the defendant company was engaged in and because he worked at the defendant’s direction and control. The judge also found that the driver was entitled to overtime even though the defendant company was exempt from overtime requirements due to its status as a motor carrier, it was still voluntarily paying overtime to other employees. This decision should serve as a warning to employers, employees, and independent contractors that these classifications will closely be scrutinized and can not be made arbitrarily.
EMPLOYERS MUST CAREFULLY DRAFT EMPLOYEE HANDBOOKS TO AVOID INCURRING CONTRACTUAL LIABILITY
The Supreme Judicial Court has recently issued a decision entitling a retired employee of the Massachusetts Turnpike Authority to be compensated for unused sick time. In LeMaitre v. Massachusetts Turnpike Authority, the plaintiff employee, a long-time turnpike employee severely limited the use of his sick days in response to a provision in a 1979 handbook promising financial incentives for doing so. Subsequently, the MTA decreased the value of benefits offered under its “Sick Leave Incentive Program” in 1996. The court determined that the MTA could not apply the changes retroactively to the benefits that the plaintiff had already earned.
In making its decision, the Supreme Judicial Court put specific emphasis on the plaintiff employee’s reliance on the policy. LeMaitre filed suit in 2004, arguing that because he had accumulated 403 unused sick days, he had been bilked out of more than $80,000. The court found LeMaitre’s reliance on the policy to be reasonable, and determined that he was entitled to the benefit. This decision relied on the reasoning in several earlier employee-handbook cases where the court found that an employee manual can alter an at-will employment relationship and form the basis for a contract.
This decision places more emphasis than ever on the language of employee handbooks and the procedures followed in disseminating them. Employers should take special care in drafting disclaimers in handbooks by making clear that employees ought not to rely on the protocol laid out in such handbooks. Even such careful drafting will not fully immunize an employer from potential contractual liability, stemming from the content of the employee handbook. Ultimately, the court will look at the facts of each case and determine whether or not an employee relied upon the handbook’s provisions and took actions based on these provisions. If an employee did, it is likely that the Court will determine that a contract was made. You can avoid exposure to liability by hiring experienced counsel to review and revise your employee handbooks and your procedures for disseminating such handbooks.
MEN ARE NOW ELIGIBLE FOR MATERNITY BENEFITS
This can best be described as a revolutionary decision; the Massachusetts Commission Against Discrimination (“MCAD”) has recently announced its intention to apply the Massachusetts Maternity Leave Act (“MMLA”) to both women and men. Speaking at a private function, the MCAD’s Commissioner, Martin B. Ebel revealed that, effective immediately, the commission plans to prosecute MMLA cases in a gender-neutral fashion. In other words, men will now be allowed to apply for MMLA maternity leave benefits.
The MCAD’s new policy is causing an uproar in the employment bar, because on its face, the law clearly states that it applies only to women. This radical change in the law represents a complete departure from the law’s historic interpretation, which requires that female employees be given eight weeks of unpaid leave when they give birth or adopt a child.
The Commissioner reasoned that the change was necessary, in light of the Supreme Judicial Court’s landmark Goodridge v. Dept. of Public Health decision, which legalized same-sex marriage, and recent amendments to the MMLA, which granted expanded leave to adoptive parents. With the change in law, same sex couples who adopt would now be entitled to parental leave. The Commissioner further reasoned that the change was necessary to further the MCAD’s statutory mandate, which is to eliminate, eradicate and prevent discrimination in Massachusetts.
EMPLOYEE CAN BRING SUPERIOR COURT CLAIMS, NOT PREVIOUSLY PLEADED AT THE MCAD
In order to bring an employment discrimination case in most instances in Massachusetts, an employee must first file a complaint at the MCAD. After the MCAD has the opportunity to investigate the case for a period of 90 days, a litigant may file a superior court lawsuit. In the past, many attorneys interpreted the law to prohibit an employee from bringing claims in the Superior Court which were not specifically raised in the MCAD Complaint.
However, the Appeals Court recently decided in Windross v. Village Automotive Group, Inc. that an employee can bring a hostile work environment claim against his former employer in Superior Court even though he did not specifically assert such claim in his race-bias complaint before the MCAD. The defendant employer argued that by not specifically pleading the claim as a distinct cause of action in his complaint, the plaintiff employee failed to exhaust administrative remedies. As a result, the defendant argued, the claim should have been barred from Superior Court.
The Appeals Court disagreed, finding that the underlying facts regarding the plaintiff’s hostile work environment claim were set forth with sufficient specificity such that the MCAD may reasonably have been expected to uncover the existence of additional facts giving rise to potential liability on that theory. The Appeals Court reasoned that “even if conduct which may be characterized as harassment may not, by itself, rise to the level of a hostile work environment, this does not mean that a heightened pleading standard exists for claims based on that theory.” Accordingly, the case was allowed to proceed to a jury trial on both the race-bias and hostile work environment claims. This decision only underscores the importance of preventing litigation by training managers on ways to comply with the law and avoiding discrimination claims and how to deal quickly and effectively with discrimination and harassment claims as they arise.
RECOMMENDATIONS
We recommend that you consult your counsel for guidance on how to comply with these important new developments. You should also train your managers on preventive law strategies so that they will know the law in order to avoid the pitfalls of ignorance.
McKenzie & Associates, P.C. would be delighted to provide consultation to your organization on labor and employment matters in order to prepare you for, and prevent, unintended violations of Massachusetts’ employment laws.
Please call Sandy P. Botelho or Denzil D. McKenzie at 617-723-0400 for more information regarding any of these new developments.