Connecticut 2015 Employment Law Update

Connecticut 2015 Employment Law Update

LEGISLATIVE UPDATE

The Connecticut General Assembly passed a number of employment bills during its 2015 session which were signed by the governor and enacted into law.  Those of particular interest to employers address the online privacy rights of employees, impose penalties upon employers who fail to comply with minimum wage and overtime laws, prohibit employers for taking action against employees who voluntarily exchange information regarding the wages they are paid, and extend the protections of the Connecticut Fair Employment Practices Act to interns,.

Public Act No. 15-6  (An Act Concerning Employee Online Privacy)

Effective October 1, 2015, Public Act No. 15-6, protects prospective and current employees from employer interference with their “personal online accounts,” which is defined to include any online account used exclusively for personal purposes (including through electronic mail, social media or retail-based internet websites).  It does not include “any account created, maintained, used or accessed by an employee or applicant for a business purpose of such employee’s or applicant’s employer or prospective  employer.”

The law precludes employers from requesting or requiring a prospective or current employee to: (1) divulge his or her username, password or other authentication information used to access a personal online account; (2) authenticate or access a personal online account in the presence of the employer; and (3) invite the employer or accept an invitation from the employer, to join a group affiliated with his or her personal online account.  Furthermore, no adverse  employment action  (such as discipline, termination or retaliation) can be taken by an employer against a current employee for refusing to engage in such activity, or for filing a complaint against the employer for requiring the disclosure of such information, or that such action be undertaken by the employee.  Similarly, an employer cannot refuse to hire a prospective employee for refusing to engage in such activity.

The law does not restrict employers from “conducting an investigation of personal online accounts of prospective or current employees for the purpose of ensuring compliance with applicable state or federal laws, regulatory requirements or prohibitions against work related employee misconduct, provided the employer has received specific information about activity on an employee or applicant’s personal online account.”  It also does not restrict an employer from “conducting an investigation based on the receipt of specific information about an employee or applicant’s unauthorized transfer of the employer’s proprietary information, confidential information or financial data to or from a personal online account operated by an employee, applicant or other source.” Incident to an employer’s investigation under the aforementioned circumstances, the employer may require the prospective/current employee to provide access to his/her personal online accounts provided the employee is not required to disclose to his/her employer the username, password or other authentication information for the account.

The law also does not prevent an employer from: (1) monitoring, reviewing, accessing or blocking electronic data stored on an electronic communications device paid for, in whole or in part, by the employer, or traveling through or stored on an electronic communications device paid for, in whole or in part, by the employer, or traveling through or stored on an employers’ network, in accordance with state and federal law: (2) taking adverse action against a prospective or current employee who has transferred, without the employer’s permission, the employer’s proprietary, confidential, or financial information to or from his or her personal online account; or (3) otherwise complying with the requirements of federal or state laws, regulations, rules, case law or rules of self regulatory organizations. 

An employer may also request or require that a prospective or current employee provide the employer with his or her username, password, or other authentication information used to access (i) any account or service provided by the employer or that the employee uses for business purposes of the employer, or (ii) any electronic communications device supplied or paid for, in whole or in part, by the employer.

Prospective and current employees who believe that the law has been violated have the right to file a complaint with the state Labor Commissioner, who shall investigate such complaint and may hold a hearing. In the event of a violation of the Act, the commissioner may fine the employer $500 for a first time violation and $1,000 for each subsequent violation thereafter. If the employee or applicant prevails at the hearing, he/she shall be awarded reasonable attorneys fees and costs.   The Commissioner can also award the employee up to $1,000, as well as order that he/she be hired/reinstated, awarded back pay, and that their employee benefits be reinstated, as well as such other relief as “deemed appropriate.”  Any party aggrieved by the decision of the labor commissioner may appeal the decision to the Superior Court.

Public Act No. 15-86 (An Act Concerning An Employer’s Failure to Pay Wages)(C.G.S. §31-72)

As of October 1, 2015, an employee who is paid by his or her employer less than the minimum fair wage or overtime wage to which he or she is entitled, may recover in a civil action “twice the full amount of such minimum wage or overtime wage less any amount actually paid to him or her by the employer, with costs and such reasonable attorney’s fees as may be allowed by the Court.”  If, however, the employer establishes that it had a good faith belief that the underpayment of the aforementioned types of wages was in compliance with the law, it is only required to pay the full amount of the wages owed, less any amount actually paid to the employee, with costs and reasonable attorney’s fees, as may be allowed by the Court.  An agreement between an employer and an employee to work for less than the minimum wage or the established overtime wage is no defense to such an action.

The same applies when an employee or labor organization representing an employee institutes an action to enforce an arbitration award, which requires an employer to make an employee whole or to make payments to an employee welfare fund.  “The Labor Commissioner may collect the full amount of any such unpaid wages, payments due to an employee welfare fund or such arbitration award, as well as interest calculated in accordance with the provisions of section 31-265from the date the wages or payment should have been received, had payment been made in a timely manner.  In addition, the Labor Commissioner may bring any legal action necessary to recover twice the full amount of unpaid wages, payments due to an employee welfare fund or arbitration award, and the employer shall be required to pay the costs and such reasonable attorney’s fees as may be allowed by the Court.”

Public Act 15-196 (An Act Concerning Pay Equity and Fairness)(“Pay Equity Act”)

The Pay Equity Act became effective July 1, 2015.  The Act prohibits employers from preventing employees from sharing information about their wages. The Act states that “no employer shall: (1) prohibit an employee from disclosing or discussing the amount of his or her wages or the wages of another employee of such employer that have been disclosed voluntarily by such other employee; (2) prohibit an employee from inquiring about the wages of another employee of such employer; (3) require an employee to sign a waiver or other document that denies the employee his or her right to disclose or discuss the amount of his or her wages or the wages of another employee of such employer that have been disclosed voluntarily by such other employee; (4) require an employee to sign a waiver or other document that denies the employee his or her right to inquire about the wages of another employee of such employer; (5) discharge, discipline, discriminate against, retaliate against or otherwise penalize any employee who discloses or discusses the amount of his or her wages or the wages of another employee of such employer that have been disclosed voluntarily by such another employee; or (6) discharge, discipline, discriminate against, retaliate against or otherwise penalize any employee who inquires about the wages of another employee of such employer.”

The law does not require an employer to disclose the amount of wages paid to any employee. Similarly, it does not compel an employee to disclose the amount of compensation paid to him by his or her employer.

The Act provides a private right of action for an aggrieved employee, with a two year statute of limitations.  No exhaustion of administrative remedies is required.  An employer found to violate the Act may be found liable for compensatory damages, attorney’s fees and costs, punitive damages and other legal and equitable relief the Court deems just and proper.

Public Act 15-56 (An Act Protecting Interns from Workplace Harassment and Discrimination)

This Act provides unpaid interns with the same protections against discrimination and harassment as provided to employees under the Connecticut Fair Employment Practices Act (“CFEPA”).  The Act defines “employer” as “any person engaged in business in the state, including the state and any political subdivision thereof, that provides a position for an intern.”  “Intern” is defined as “an individual who performs work for an employer for the purpose of training, provided (A) the employer is not committed to hire the individual performing the work at the conclusion of training period; (B) the employer and the individual performing the work agree that the individual performing the work is not entitled to wages for the work performed; and (C) the work performed (i) supplements training given in and educational environment that may enhance the employability of the individual, (ii) provides experience for the benefit of the individual, (iii) does not displace any employee of the employer, (iv) is performed under the supervision of the employer or an employee of the employer and (v) provides no immediate advantage to the employer providing the training and may occasionally impede the operations of the employer.”

Pursuant to the Act, no employer or agent of an employer shall: “ (1) refuse to hire any individual seeking an internship or to allow any intern to work; (2) bar or discharge any intern from providing internship services; or (3) discriminate against such intern in terms, conditions, or privileges of service to the employer, because of the intern’s race, color, religious creed, age, sex, gender identity or expression, sexual orientation, marital status, national origin, ancestry, present or past history of mental disability, intellectual disability, learning disability or physical disability, including but not limited to blindness.”  Employers and their agents are also precluded from advertising any internship opportunity in a manner that would restrict such internship to, or discriminate against, individuals of a certain race, color, religious creed, age, sex, gender identity or expression, sexual orientation, marital status, national origin, ancestry, past or present history of mental disability, intellectual disability, learning disability or physical disability, including but not limited to blindness.  The Act prohibits employers and their agents from discharging, expelling or otherwise discriminating against an intern because such intern has filed a complaint or testified or assisted in any proceeding under §§46a-82, 46a-83 or 46a-84 of the General Statutes.  Finally, the Act prohibits employers or their agents from engaging in any sexual harassment toward any intern or individual seeking an internship.

The Act will be included as part of the list of discriminatory practices in Connecticut General Statutes §46a-51.  While not defined as “employees” under CFEPA, interns may now file charges of discrimination and/or sexual harassment with the Connecticut Commission on Human Rights and Opportunities.

Caselaw Update

The Connecticut Supreme Court rendered very few employment decisions this term. Its most significant employment decision of the year expanded whistleblower protection for both public and private employees.   The high court ruled that under the Connecticut Constitution employee speech relating to official job duties on “certain matters of significant public interest” is protected from employer discipline in both public and private workplaces.  This affords employees greater free speech protection than found under the First Amendment of the U.S. Constitution.

The significant Connecticut Appellate Court decisions held that punitive damages are not available under the Connecticut Fair Employment Practices Act and that in determining whether someone is an employee under the Connecticut Fair Employment Practices Act, in the absence of a clear employer/employee relationship, a court must apply the remuneration test adopted by the Second Circuit Court of Appeals and other federal circuit courts in Title VII cases.

Trusz v. UBS Realty Investors, LLC 319 Conn. 175 (2015). 

In Trusz, The Connecticut Supreme Court rendered a decision changing the interpretation of Connecticut’s whistleblower statute Conn. Gen. Stats. §31-51q and in so doing established broad protections for employees who raise issues of public concern in both private and public workplaces. Specifically, it ruled that under the Connecticut state constitution, employee speech relating to official job duties on “certain matters of significant public interest” is protected from employer discipline in a public workplace and that those protections extend to employees in the private sector as well.

Plaintiff Richard Trusz was the head of UBS Realty’s valuation unit and the managing director of UBS Realty, and as such was responsible for overseeing the process resulting in the valuation of properties held in UBS Realty’s private real estate investment funds.  Mr. Trusz reported to management that he had found valuation errors regarding the properties held in UBS’ real estate investment funds.  An investigation was conducted by UBS’ compliance officer, as well as third party auditors which confirmed Mr. Trusz’s findings.  However, both determined that nothing needed to be done to correct the errors, including issuing restatements of the funds’ financial statements. Mr. Trusz disagreed, and continued to argue that a failure to disclose the valuation errors was a breach of the company’s fiduciary duty, and legal and ethical obligations to investors.    He was later terminated purportedly for other reasons. 

Mr. Trusz filed a complaint with the CHRO in which he claimed that he was terminated in retaliation for having opposed what he believed to be unlawful activity by UBS and for reporting securities  laws violations and for speaking up on an issue of public interest.  Thereafter, he filed a lawsuit against UBS in the United States District Court District of Connecticut in which he alleged, among other things, that UBS violated Conn. Gen. Stats. §31-51q. by subjecting him to discipline “on account of the exercise. of rights guaranteed by §§ 3, 4 or 14 of Article I of the Connecticut State Constitution.”

Pursuant to Conn. Gen. Stats. §31-51q an employee can maintain an action against his/her  employer who disciplines or discharges him/her  based on his or her exercise of constitutional rights guaranteed by the First Amendment of the U.S. Constitution or the freedoms of religion, speech, press and the rights to assemble and petition under the Connecticut Constitution, provided that the exercise of these rights does not substantially interfere with the employee’s job performance or the working relationship between the employee and the employer. 

While a motion for summary judgment was pending before the U.S. District Court, the Connecticut Supreme Court rendered a decision in Schumann v. Dianon Sys. Inc., 304 Conn. 585 (2012) in which it concluded that the U.S. Supreme Court holding in Garcetti v. Ceballos, 547 U.S. 410 (2006), that speech pursuant to a public employee’s official job duties was not protected speech pursuant to the First Amendment of the U.S. Constitution, applies to claims made under C.G.S. § 31-51q against a private employer that are based on the First Amendment of the U.S. Constitution.  In light of this decision, the U.S. District Court certified to the Connecticut Supreme Court the question of whether the Garcetti standard applied to claims made under C.G.S. § 31-51q pursuant to the free speech provisions contained in the Connecticut State Constitution.   The Supreme Court held that it did not.

The Supreme Court noted that it had previously held that Art. I §§ 4, 5 and 14 of the Connecticut Constitution sets forth broad free speech rights “more emphatically than their federal counterpart”, which it found “warrant an interpretation separate and distinct from that of the first amendment.”  The Court found that Art. I, Section 4 of the Connecticut Constitution contains language which protects employee speech in the public workplace on the widest possible range of topics, as long as the speech does not undermine the employee’s legitimate interest in maintaining discipline, harmony and efficiency in the workplace.  The Court found this to be consistent with the Pickering/Connick standard established by the U.S. Supreme Court which held than an employee has the right to comment on a matter of public interest that will be weighted against he employer’s interest in promoting efficient services.

Specifically, the Court found that courts should apply a balancing test that weighs the employee’s interests as a citizen on matters of public concern versus the employer’s interest in promoting the efficiency of the public services it performs (a form of the Pickering/Connick balancing test). “If an employee’s job related speech reflects a mere policy difference with the employer, it is not protected.  It is only when the employee’s speech is on a matter of public concern and implicates an employer’s “official dishonesty…other serious wrongdoing, or threats to health and safety that the speech trumps the employer’s right to control its own employees and policies.”

Thus, the  Court held “under the state constitution, employee speech pursuant to official job duties on certain matters of significant public interest is protected from employer discipline in a public workplace, and §31-51q extends the same protection to employee speech pursuant to official job duties in the private workplace.”   In extending this protection to private employees, the Connecticut Supreme Court has exceeded the protection beyond what speech the federal courts would protect under the U.S. Constitution.

Tomick v. UPS, 157 Conn. App. 312 (2015).

The Connecticut Appellate Court held that a plaintiff cannot recover punitive damages in connection with claims brought pursuant to the Connecticut Fair Employment Practices Act (“CFEPA”).    In so doing, the Court stated that punitive damages are an extraordinary remedy that may only be awarded if expressly authorized by statute.  The relevant portion of CFEPA authorizes the Court to award attorney’s fees and costs, but not punitive damages.  The Court stated that if the legislature had wanted to make punitive damages available to a CFEPA plaintiff, it could have done so, as it has in other statutes, but it did not.  To read such intent into the statute would result in double recovery for the plaintiff, since punitive damages in Connecticut consist of attorney’s fees and costs, which are already recoverable in connection with a successful CFEPA claim. Accordingly, the Court held that punitive damages are not available under the statute.

Commission on Human Rights and Opportunities v. Echo Hose Ambulance, 156 Conn. App. 239 (2015).

This appeal arose out of a complaint filed by an African American woman, with the Commission on Human Rights and Opportunities (“CHRO”).  The woman, Sarah Puryear, was accepted into the precepting program at Echo Hose Ambulance, a company which provides ambulance transport, first responder services and community CPR training.  She was suspended from the preceptor program, was reinstated and made a member of the organization, only to later be terminated for allegedly abandoning her crew.  She subsequently filed a Complaint with the CHRO in which she alleged that Echo Hose Ambulance and the City of Shelton had illegally discriminated against her, because of her race and color in violation of CFEPA and Title VII.   Echo Hose and the City of Shelton moved to strike the complaint on the grounds that she was not an employee of either entity.  The CHRO struck the complaint on the grounds that it failed to allege sufficient facts to support the existence of an employment relationship between the parties, because Ms. Puryeaer did not allege that she received direct or indirect remuneration for her services.  In so doing, the CHRO applied the “remuneration test” applied to determine whether someone is an “employee” under Title VII of the Civil Rights Act of 1964.  The trial court upheld the CHRO’s decision to strike the complaint and Mr. Puryear appealed.

On appeal, Ms. Puryear alleged that the trial court and the CHRO erroneously applied the Title VII remuneration test to define the term “employee” under CFEPA, among other grounds. Accordingly, the issue before the Appellate Court was whether in defining the term “employee” under CFEPA, Connecticut should adopt the remuneration test applied by the United States Court of Appeals for the Second Circuit to determine who is an “employee” under Title VII of the Civil Rights Act of 1964.

 CFEPA defines “employee” as any person employed by an employer.  The Appellate Court stated that this definition sufficed with regard to traditional employment, where an employee received monetary compensation for his or her services, but is “less helpful” in cases where the compensation allegedly provided by the purported employer is not monetary but takes the form of other benefits.  In those instances, the Court found that the term “employee” as used in the statute, is not plain and unambiguous and so it must be interpreted through the use of extra textual sources.  The Court found that the Connecticut Supreme Court has endorsed looking to federal law in interpreting state antidiscrimination statutes.  The Appellate Court concluded, as did the trial court, that federal law interpreting Title VII is an appropriate source of guidance in this instance. 

Title VII contains the identical definition of “employee” set forth in CFEPA.   Federal Courts of Appeals have adopted a “remuneration test” as a threshold requirement for determining whether an individual is an employee. To satisfy the test, the Second Circuit requires a putative “employee” to establish that he or she “has received direct or indirect remuneration from the alleged employer.”  An employment relationship can exist under Title VII “even when the putative employee receives no salary so long as he or she gets numerous job related benefits, such as health insurance, vacation, sick pay, a disability pension survivor’s benefits, group life insurance, scholarships for dependents upon death, or other “indirect but significant remuneration.”  In the absence of a clear contractual employer-employee relationship, a party claiming to be an employee under Title VII must come forward with substantial benefits not merely incidental to the activity performed in order to satisfy the remuneration test.  The Appellate Court held that for a worker to be an employee for purposes of CFEPA, the worker must receive “Remuneration” in the form of wages or other substantial benefits, and that that the trial court properly applied the “remuneration test” as interpreted an applied by the Second Circuit to Title VII claims, in a case where a traditional employment relationship did not exist.