Category: Employment Law

Whistleblower Protection for Employees under the Energy Reorganization Act

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1. Employees and Employers Covered

Under the Energy Reorganization Act (ERA), certain employees in the nuclear power and nuclear medicine industries may file complaints to the Department of Labor, through the Occupational Safety and Health Administration (OSHA), if they believe that they have experienced discrimination or retaliation for reporting alleged violations of nuclear safety laws or regulations. Under the ERA, the definition of an employee refers to anyone who is employed by a licensee of the Nuclear Regulatory Commission, the Department of Energy, and their contractors and subcontractors. Independent contractors may also be protected, depending on the extent of control the employer exercised over a worker. Former employees are protected where the employer’s post-employment actions arise out of his/her former employment.

These protections do not apply to any employee who acts without direction from his or her employer, and thereby deliberately causes a violation of any requirement of this chapter or of the Atomic Energy Act.

2. Protected Activity

An employee is protected from retaliation in situations where he/she is reporting internally, to regulators, or to media, issues of nuclear safety. These actions are protected only when the reported practices are that which he or she reasonably believes to implicate nuclear safety. The employee must reasonably believe the employer is engaged in the conduct, but does not need to be right in the belief as long as the belief is reasonable.

3. Proving Your Case

Any employee who believes that (s)he has been discharged or otherwise discriminated against for engaging in such protected activity may file a complaint with the Secretary of Labor, through OSHA, within 180 of the alleged incident.

The Secretary shall dismiss the complaint unless the complainant has made a prima facie showing that any of the behaviors prohibited in the Act was a contributing factor in the unfavorable personnel action alleged in the complaint. Relief may not be ordered if the employer demonstrates by clear and convincing evidence that it would have taken the same unfavorable personnel action in the absence of such behavior.

4. Available Remedies

If an employee’s whistleblower claim under the ERA is successful, he/she is entitled to reinstatement, and may be entitled to back pay and benefits, lost wages, compensatory damages for pain and suffering, and attorneys’ fees.

5. Time to File: 180 days after alleged violation.

If you believe that you have a whistleblower claim under the ERA, please contact an attorney at Sidkoff, Pincus & Green, located in Philadelphia, Pennsylvania.

Whistleblower Protection for Employees under the Solid Waste Disposal Act

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1. Employees and Employers Covered

 The purpose of the Solid Waste Disposal Act (SWDA) is to safeguard the health, welfare, and physical property of people and to protect the environment by controlling the management of solid waste. As determined by the draftors of this Act, it is in the public interest to require hazardous waste to be stored, processed, and disposed of only at permitted hazardous industrial solid waste facilities. The SWDA protects employees from retaliation for reporting abuses of funding and assistance, violations of waste management requirements, or other violations of the Act.

This Act covers employees of agencies, Federal or State, with the authority and responsibility for planning or administration of solid wastes. Whistleblower protection is not offered to any employee, who acting without discretion from his employer deliberately violates any requirement of this chapter.

2. Protected Activities

Pursuant to the SWDA, no person shall fire or discriminate against any employee or authorized representative of employee due to the employee’s actions in providing information to the state or federal government regarding violations of environmental laws, or assisting in proceedings regarding the administration or enforcement of the provisions of this chapter.

3. Proving Your Case

A successful complainant must prove the following by a preponderance of the evidence:

1. The employee engaged in protected activity;

2. The employer knew of the employee’s reporting/protected activity;

3. The employer subjected the employee to unfavorable personnel action; and

4. The employee’s protected activity was a “contributing factor” to the employer’s decision to take unfavorable personnel action against the employee. Complaints are made to the Department of Labor, through the Occupational Safety and Health Administration (OSHA), and must be made within 30 days of the adverse employment action.

In order to avoid liability, the employer must demonstrate “clear and convincing evidence” that it would have taken the same unfavorable personnel action against the employee in the absence of the employee’s protected activity.

4. Available Remedies

If an employee’s whistleblower claim is successful, he or she may be entitled to reinstatement with previous seniority and benefits, back pay with interest, and other possible relief including attorneys’ feeds, compensatory and punitive damages.

5. Time to File: 30 days from alleged violation.

If you believe that you have a whistleblower claim under the SWDA, please contact an attorney at Sidkoff, Pincus & Green, located in Philadelphia, Pennsylvania. 

A Provision in an Employee Handbook May Supplant the At-Will Rule in Pennsylvania

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A claim for wrongful discharge in Pennsylvania may only be asserted in very limited circumstances. An at-will employee who is terminated may claim wrongful discharge only when his termination is made with a specific intent to harm or is contrary to public policy. Tourville v. Inter–Ocean Ins. Co., 353 Pa.Super. 53, 55, 508 A.2d 1263, 1265 (1986); Engstrom v. John Nuveen and Company, 668 F.Supp. 953, 958 (E.D.Pa.1987); Geary v. U.S. Steel Corp., 456 Pa. 171, 178–83, 319 A.2d 174, 177–80 (1974).

In Pennsylvania, there is a very strong presumption of at-will employment relationships. The presumption may be overcome by express contract, implied in-fact contract (where the surrounding circumstances of the hiring indicate that the parties did not intend to be at-will), and additional consideration passing from the employer (if the employee bestows a legally sufficient benefit or incurs a sufficient detriment for the benefit of the employer beyond the services for which he was hired, a court may infer that the parties intended to overcome the at-will presumption).Scott v. Extracorporeal, Inc., 376 Pa.Super. 90, 95, 545 A.2d 334, 336 (1988).

Notwithstanding the level of proof required to supplant the at-will presumption, “[a] handbook is enforceable against an employer if a reasonable person in the employee’s position would interpret its provisions as evidencing the employer’s intent to supplant the at-will rule.” Scott v. Extracorporeal, Inc., supra, 376 Pa.Super. at 97, 545 A.2d at 337; DiBonaventura v. Consolidated Rail Corp., 372 Pa.Super. 420, 426, 539 A.2d 865, 868 (1988); Reilly v. Stroehmann Bros. Co., 367 Pa.Super. 411, 419–20, 532 A.2d 1212, 1215–16 (1987). In all of these cases the courts looked to the language of the handbook to determine whether a reasonable employee would understand the provisions to transform his at-will employment into a contractual employment relationship. “A handbook, to be construed as a contract, must contain unequivocal provisions that the employer intended to be bound by it and, in fact, renounced the principle of at-will employment.” Id. at 416, 532 A.2d at 1214.

It is important to keep in mind that there is no presumption that the distribution of a handbook by an employer shows that the employer intends to alter the existing employer-employee relationship.  Mudd v. Hoffman Homes for Youth, Inc., 374 Pa. Super. 522, 543 A.2d 1092 (1988); Martin v. Capital Cities Media, Inc., 354 Pa. Super. 199, 511 A.2d 830 (1986).  As shown above, however, an employee may reasonably regard a handbook as legally binding when the handbook, or an employer’s oral representation about the handbook, unequivocally states that it is to have this effect.

The Pennsylvania Commissioned Sales Representative Act

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The Pennsylvania Commissioned Sales Representative Act (“PCSRA”) provides that a “principal shall pay a sales representative all commissions due at the time of termination within 14 days after termination” and “all commissions that become due after termination within 14 days of the date such commissions become due.” 43 Pa. Stat. §§ 1473–74.  If a principal “willfully” violates these provisions, then the sales representative may bring a civil action to collect all unpaid commissions plus exemplary damages in an amount not to exceed two times the commissions due to the sales representative, and costs of suit and attorneys’ fees. Id. § 1475.

Under the PCSRA, a “principal” is defined as any person who does all of the following: (1) engages in the business of manufacturing, producing, importing or distributing a product for sale to customers who purchase such products for resale; (2) (2) Utilizes sales representatives to solicit orders for such product; and (3) Compensates sales representatives, in whole or in part, by commission. Id. § 1471.

Furthermore, the PCRA defines a “sales representative” as “[a] person who contracts with a principal to solicit wholesale orders from retailers rather than consumers and who is compensated, in whole or in part, by commission.” Id.   A sales representative, as that term is defined in the PCRA, explicitly excludes “one who places orders or purchases for his own account for resale or one who is an employee of a principal.” Id.

Although the PCRA is an important and beneficial statute for sales representatives, it is important to keep in mind that it does not provide protection to all sales agents who work on commission. Not only does the precise language of the PCRA limit its coverage to the types of sales representatives described above, but the courts have often strictly construed the terms “retailers” and “consumers” to further limit the applicability of the PCRA, despite the fact that those terms are not defined in the statute. See, Kamco Indus Sales Inc. v. Lovejoy Inc., 779 F. Supp. 2d 416 (E.D.Pa.2011); Total Control, Inc. v. Danaher Corp., No. 02–668, 2004 WL 1878238, *3 (E.D.Pa.2004); United Products Corp. v. Admiral Tool and Manufacturing Co., 122 F.Supp.2d 560, 564 (E.D.Pa.2000).

How to determine whether an Unemployment Compensation Claimant is an Independent Contractor in Pennsylvania

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In Pennsylvania, there is a presumption under Unemployment Compensation Law (“Law”) that an individual receiving wages is an employee and not an independent contractor engaged in self-employment. Electrolux Corporation v. Department of Labor and Industry, Bureau of Employer Tax Operations, 705 A.2d 1357, 1359–60 (Pa.Cmwlth.1998).  However, an employer can overcome this presumption by establishing that a claimant is self-employed. Id. at 1360.  If an employer can establish that a claimant is an independent contractor (and thus self-employed), the Law provides that such an individual “shall be ineligible for compensation for any week … [i]n which he is engaged in self-employment.” 43 P.S. § 802(h).

An employer establishes that a claimant is self-employed by proving that the claimant was: (1) free from control and direction in the performance of his service; and (2) customarily engaged in an independent trade or business as to that service. See, 43 P.S. § 753(l)(2)(B); see also, Beacon Flag Car Company, Inc. (Doris Weyant) v. Unemployment Compensation Board of Review, 910 A.2d 103, 107 (Pa.Cmwlth.2006).

As to the first prong of the test , courts consider whether the employer exercised “control” as to the work to be done and the manner in which the work is to be performed.  A number of factors have been identified by the court in determining whether an individual is free of control; they include: “whether there is a fixed rate of remuneration; whether taxes are withheld from the [individual]‘s pay; whether the employer supplies the tools necessary to carry out the services; whether the employer provides on-the-job training; and whether the employer holds regular meetings that the [individual] was expected to attend.” CE Credits OnLine v. Unemployment Comp. Bd. of Review, 946 A.2d 1162, 1168 (Pa.Cmwlth.2008).  No one factor will control the outcome, but the courts will look to the entire relationship to determine whether the requisite control exists to establish an employer-employee relationship.” Tracy v. Unemployment Compensation Board of Review, 23 A.3d 612, 616 (Pa.Cmwlth.2011).

As to the second prong of the test—whether the claimant is customarily engaged in an independently established trade, occupation, profession, or business—courts consider “whether the individual was capable of performing the activities in question [for] anyone who wished to avail themselves of the services and whether the nature of the business compelled the individual to look to only a single employer for the continuation of such services.” Venango Newspapers v. Unemployment Comp. Bd. of Review, 158 Pa.Cmwlth. 379, 631 A.2d 1384, 1388 (1993). Where the employee is free to accept or reject an assignment, the individual generally is not considered to look to a single employer for the continuation of such services. Danielle Viktor, Ltd. v. Dep’t of Labor and Indus., Bureau of Employer Tax Operations, 586 Pa. 196, 229, 892 A.2d 781, 801 (2006).

Hostile Work Environment Claims under Title VII and the Pennsylvania Human Rights Act

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Title VII of the Civil Rights Act of 1964 “makes it unlawful for an employer ‘to discriminate against any individual with respect to his [or her] compensation, terms, conditions, or privileges of employment, because of such individual’s race, color, religion, sex, or national origin.’ ” Kunin v. Sears Roebuck and Co., 175 F.3d 289, 293 (3d Cir.1999), citing 42 U.S.C. § 2000e-2(a)(1). The scope of protection provided by Title VII includes protection against a hostile work environment.

There are five elements that a plaintiff must prove to establish a claim for hostile work environment under Title VII -1) the employee suffered intentional discrimination because of his or her protected class; (2) the discrimination was pervasive or regular; (3) the discrimination detrimentally affected the employee; (4) the discrimination would detrimentally affect a reasonable person of the same race in that position; and (5) the existence of respondeat superior liability. Clark County School Dist. v. Breeden, 532 U.S. 268, 270, 121 S.Ct. 1508, 149 L.Ed.2d 509 (2001); Andrews v. City of Philadelphia, 895 F.2d 1469, 1472 (3d Cir.1990). The same standards apply to the claims raised under the Pennsylvania Human Rights Act(“PHRA”). Jones v. School Dist. of Philadelphia, 198 F.3d 403, 410 (3d Cir.1999).

With respect to the second element, the Supreme Court has made clear that Title VII is not a “general civility code,” Faragher v. City of Boca Raton, 524 U.S. 775, 788, 118 S.Ct. 2275, 141 L.Ed.2d 662 (1998). The Court has also observed that “hostile work environment” harassment must be pervasive or severe enough “to alter the conditions of … employment and create an abusive working environment.” Meritor Sav. Bank. FSB v. Vinson, 477 U.S. 57, 67, 106 S.Ct. 2399, 91 L.Ed.2d 49 (1986), quoting Henson v. City of Dundee, 682 F.2d 897, 904 (11th Cir.1982). The test looks to the totality of the circumstances, including the frequency of the discriminatory conduct, its severity, whether it is physically threatening or humiliating or a mere offensive utterance, and whether it interferes with an employee’s work performance. Harris v. Forklift Systems, Inc., 510 U.S. 17, 21, 114 S.Ct. 367, 126 L.Ed.2d 295 (1993)

The standards governing employer liability for a hostile work environment differ depending on the source of the hostility. Imputing liability for co-worker harassment is grounded in the employer’s direct negligence. Ocheltree v. Scollon Productions, Inc., 335 F.3d 325, 333-34 (4th Cir.2003). Where a co-worker is the source of the hostile environment, “liability exists where the defendant knew or should of known of the harassment and failed to take prompt remedial action.” Kunin, 175 F.3d at 293 (internal citations omitted).