Workforce Bulletin

By Eric J. Conn

A federal jury recently awarded three workers approximately $180 million in damages for injuries sustained in a 2010 explosion at a grain elevator owned by ConAgra Foods, Inc.  See Jentz v. Conagra Foods, Inc., No. 3:10-cv-00747 (S.D.I. June 1, 2012).  At the one-month trial in the U.S. District Court for the Southern District of Illinois, the plaintiffs alleged that ConAgra and West Side Salvage Inc., a maintenance contractor and co-defendant, were liable for their injuries because they failed to:

1. Clean the grain bin properly;
2. Maintain wheat middling pellets (flour ...

by Allen B. Roberts, Frank C. Morris, Jr., Stuart M. Gerson, and Michael J. Slocum

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) extended Sarbanes-Oxley’s whistleblower protection provision beyond employees of publicly-traded companies to reach the employees of their privately-held subsidiaries as well.  Reasoning that this extension was “a clarification of Congress’s intent with respect to the Sarbanes-Oxley whistleblower provision,” a federal court held that the extension applies retroactively to cover ...

By Eric J. Conn

In August of 2010, a Delta Air Lines (“Delta”) baggage handler was fatally injured in a workplace accident, when the employee was ejected from a baggage tug vehicle while not wearing a seat belt.  As a result of this incident, Delta was cited by OSHA in February 2011 for alleged violations of regulations under the Occupational Safety and Health Act, including specifically, 1910.132—relating to personal protective equipment.

Corporate-Wide Settlement

To resolve the citations, Delta entered into a settlement agreement with OSHA on April 17, 2012 that required Delta to pay a modest penalty, $8,500, but also committed Delta to install seat belts on similar industrial vehicles operated at 90 of Delta’s locations nationwide over the next year.  Delta also committed to provide seatbelt training and to mandate the use of seatbelts for 16,000 of its employees.  Delta also agreed to waive its right to demand inspection warrants, and permit OSHA to monitor this issue. Finally, the agreement stipulates that general monitoring of implementation of this corporate-wide abatement will be conducted by a third party, not OSHA.

The Delta agreement was one of the first Corporate-Wide Settlement Agreement (“CSA”) reached under OSHA’s latest June 2011 Guidelines for Administering Corporate-Wide Settlement Agreements.  Under these guidelines OSHA expanded its use of the CSA to a broader range of enforcement cases, including high profile fatality cases.  This type is settlement has special implications for the airline industry, in which employers inherently operate at dozens or even hundreds of sites—magnifying both the potential penalties and compliance costs.  See our previous posts about the risks of enterprise enforcement.

Settlement in Context

Delta is a participant in OSHA’s Voluntary Protection Program (“VPP”).  On its website OSHA states “VPP corporate applicants must have established, standardized corporate-level safety and health management systems, effectively implemented organization-wide as well as internal audit/screening processes that evaluate their facilities for safety and health performance.”  Despite Delta being an active partner with OSHA over the last decade, the settlement agreement appears to be favorable to the Agency.  On the other hand, Delta avoided inclusion in OSHA’s Severe Violator Enforcement Program (“SVEP”), which can be an option when there is a fatality and OSHA finds “one or more willful or repeated violations.”  If SVEP qualification was on the table in these negotiations, it would certainly have given OSHA substantial leverage.

by Frank C. Morris, Jr., and Allen B. Roberts

The U.S. Department of Labor (“DOL”) Administrative Review Board (“ARB”) has sounded an alarm that needs to be heard by accounting firms, law firms, and other consultants, advisors, and providers of services to publicly traded companies.  With its recent decision in Spinner v. David Landau & Associates, LLC, ARB Case Nos. 10-111, 10-115 (May 31, 2012), the ARB continued its expansion of whistleblower protection, holding that Sarbanes-Oxley (“SOX”) whistleblower protections extend to employees of privately held ...

by Allen B. Roberts and Michael J. Slocum

Global whistleblowers cannot look to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) for protection against retaliation, according to a recent federal court decision.  Taking an important step towards clarifying the reach of Dodd-Frank, and potentially impacting other statutes having similar provisions, the court ruled that the “Anti-Retaliation Provision” protecting whistleblowers under Dodd-Frank does not apply outside the territorial United States. Asadi v. G.E. Energy (USA ...

By: Kara M. Maciel and Jordan Schwartz

A recent allegation of disability discrimination from the parents of a three-year old boy with special needs has resulted in a national fitness club chain revising its policies and procedures and implementing staff training.  The alleged discrimination occurred after the child had been playing with toys in the fitness club’s Kids’ Club and had refused to move from his position in front of a slide.  Upon learning from his parents that he had autism, a staff member informed them that, had the staff known that he was autistic, they would not have ...

VC firms have been funding, and M&A transactions should continue to increase in the health information technology (HIT) sector

“We are gearing up!”  I heard this statement and other similar statements from many VC firms when I recently attended “The World Congress Annual Leadership Summit on Mergers & Acquisitions in the Health Care” in Orlando, Florida.  Consistently, panelists and attendees at the conference noted that VC firms are funding for M&A transactional opportunities within the heath information technology (or HIT) sector.  According to many managing directors ...

By Michael Kun

On Monday, June 25, 2011, the California Supreme Court issued its long-awaited decision in Coito v. Superior Court, addressing the issue of whether a party in litigation could rely upon the work product doctrine to withhold witness statements obtained by its attorneys or the identities of persons who had given such statements. 

In short, while parties in California have long relied upon dicta in the Court of Appeal decision known as  Nacht v. Lewis for the proposition that such information is protected from disclosure by the work product doctrine, case-by-case ...

By Matthew Sorensen and Dana Livne

One of the major ways in which American employment law has traditionally differed from its British counterpart has been its entrenched employment “at-will” doctrine. The “at-will” employment doctrine provides employers with the right to terminate their relationships with their employees at any time, with or without notice or cause.  UK companies doing business in the US are often relieved to be advised that they become “at-will” employers to their US-based employees. In the US, unless an employer has entered an employment contract ...

by Peter M. Panken

The Seventh Circuit Court of Appeals recently held, in a case of first impression, that a manager who was not the actual decision-maker in an employee’s discharge could still be held personally liable under Section 1981 of the Civil Rights Act of 1866 under a “cat’s paw” theory of liability.

In Smith v. Bray, Darrel Smith claimed that he had been subjected to racial harassment by his immediate supervisor, James Bianchetta, and that he was fired because he reported this harassment to a human resources manager, Denise Bray.  The employer’s liability was ...