Over the weekend, the New York Times published a chilling article about employer reliance on credit reports, The Long Shadow of Bad Credit in a Job Search. The main character was a poor guy who couldn’t find work as a shoe salesman after he couldn’t pay medical bills incurred for an injury he suffered after getting laid off (and losing his insurance).

The article points out that employers are actually a bit less likely to check credit reports on applicants than they have been in the past. While previous surveys (conducted by our friends at SHRM) have found that about 60% of employers check credit reports on applicants, that number is now down to about 50%. At the same time, however, many people have seen their good credit ratings go down the tubes in the last five years. So fewer employers are checking, but they may be dinging a higher percentage of candidates for poor credit.

Why do employers check credit reports, anyway? For certain positions, a credit report might reveal pertinent information. You may not want an employee who never pays bills on time to manage a department budget, prepare economic forecasts, or have free access to a company credit card. In many situations, however, poor credit reveals no more than bad luck: high medical bills, divorce, and job loss account for many financial woes. Although there are certainly some people who run up huge debts on luxury items, never planning to pay for them, there are many whose debts are based on sadder — and more mundane –circumstances.

Rejecting these applicants for jobs puts them in a Catch-22: They lost a job, which hurt their credit, which will prevent them from getting a job, and so on. In recognition of this, states are starting to step in and prohibit employers from using credit reports in making hiring and other job decisions. Nine states have passed these laws so far, and more are considering similar legislation. You can find our articles on these laws in State Laws on Employer Use of Credit Reports; for more information on the rules for using applicant credit reports in hiring, including notice and consent requirements, see Can Prospective Employers Check Your Credit Report?

Temporary Office Dog: Richmond

A few years ago, I posted about some of the benefits of bringing dogs to work, including higher productivity, lower stress, better social cohesion, and better teamwork. A recent article in USA Today cites even more research to prove what dog owners instinctively know: Pets decrease stress in a tangible way, by lowering cholesterol and blood pressure levels. They increase our opportunities to socialize and exercise.

In fact, the article cites a 2012 study conducted at a single workplace in North Carolina, which revealed that workplace stress levels of employees who brought their dogs to work decreased by 11% as the day progressed. Employees who didn’t bring their dogs (or didn’t have dogs to bring) saw stress levels rise a whopping 70% in the same timeframe.

All of these benefits help explain the continuing office trend to allow dogs at work. Surveys show that about one in five employers allow employees to bring dogs to work, including the Daily Show and Google. (Those who consider themselves “dog people ” rather than “animal people” have to love their gentle rebuff of the feline: “we like cats, but we’re a dog company.” Me too, The Google; me too.)

Former Office Visitor: Flora

And those are just the human benefits: For the dogs, the benefits might be even greater. Dogs get to enjoy the company of their human companions for more of the day. They get to scrounge scraps from coworkers. They get treats, belly rubs, and head scratches from office dog lovers. And, for some dogs, the opportunity to go to work lowers their stress as much as it lowers ours; it may even save their lives.

Pet ownership is at an all-time high, according to the American Pet Products Association. Almost half of all households in this country have a dog. But it can be hard to take care of a dog when you’re a working stiff. Dogs need to use the facilities, exercise, socialize, and get their mental stimulation, just like we do. If a family member, friend, or paid helper isn’t available to meet these needs, dogs will figure out other ways — ways less friendly to furniture, carpets, and possibly neighbors — to get things done. Older dogs may be fine on their own all day, with the help of some chew toys and a doggie door. But for younger dogs and recently acquired dogs, more supervision is better.

No alarm clock today

That’s my personal angle on the dogs at work issue: It’s a great way to help more dogs get adopted and stay that way. My employer has been dog-friendly for its entire 40+ year history. Once a week, one of my dogs comes to work. Every once in a while, I stop by the office while walking a dog from our municipal shelter, Berkeley Animal Care Services, like red-headed beauty Flora. And recently, I was able to help a friend and her newly adopted dog get over the “home alone” hump by bringing teenage heartthrob Richmond to work with me for a few days. This allowed Richmond to socialize with lots of new people, get used to behaving calmly in a new environment, and have some time to settle in with his new family; now, he’s a successful stay-at-home companion to canine siblings (including little Bimo, pictured above) and human grandparents. (And my own dogs didn’t seem too sad about the opportunity to sleep in.)

Looking for your own dog to bring to work? Visit your local shelter! If you’re in one of the counties that participates in Maddie’s Fund Pet Adoption Days (San Francisco and Alameda County are), you can adopt your pet free on the first weekend in June — and be all set for Take Your Dog to Work Day on June 21.

The National Labor Relations Board (NLRB) just can’t win for losing these days. First, the Supreme Court decided that a two-member “rump” (of the usual five-member Board) was not authorized to conduct NLRB business. This threw about 600 decisions into doubt, as they were issued after the terms of the other three members had expired. Next, federal courts held up the NLRB’s efforts to make rules that would require employers to post a notice of union rights and would speed up union elections. Then, the D.C. Circuit Court of Appeals decided that President Obama’s effort to solve that two-member problem by making three recess appointments to the Board had failed, and that the Board still lacked the necessary quorum (at least three members) required to do any business.

The Obama administration recently appealed that last decision to the Supreme Court, but the D.C. Circuit wasn’t finished yet: Yesterday, that Court struck down the NLRB’s posting requirement as a violation of employer free speech rights. This requirement had been on hold while the Court heard arguments and made its decision, so the opinion hasn’t changed the status quo. It will take a Supreme Court opinion (in favor of the NLRB, quite unlikely) to get these posters up in the workplace.

The Court of Appeals opinion focused mainly on the Board’s methods of enforcing the posting requirement. The Court found that the Board didn’t have the authority to penalize the employer for failing or refusing to put up the poster (by, for example, making failure to post an unfair labor practice, creating a legal presumption that failure to post showed an anti-union bias, or extending the statute of limitations for employees to file a charge with the NLRB if their workplace had no poster informing them of their rights). The basis for this holding was employer free speech. The NLRB is not allowed to penalize employers for saying what they wish about unions, as long as no coercion or threats are involved. By the same token, the Court reasoned, the NLRB can’t force employers to “speak” by punishing them for failing to hang the poster.

It’s interesting to me how much firepower has been levied against the NLRB lately, especially about something so basic as a workplace rights poster. Employers are already required to hang posters about health and safety, discrimination laws, the minimum wage, and more, so I would have thought this type of requirement wouldn’t raise much employer ire. Because they are such a routine feature of the workplace landscape, most employees ignore them, in my experience. So why all the uproar about adding one more poster to the bulletin board?

Based on all of the recent activity against the NLRB, as well as the fights in the past couple of years over public employee unions, right to work laws, collective bargaining rights, and so on, it seems clear that the opposition to the NLRB is about more than posters. These lawsuits haven’t been brought by individual employers, but by large employer advocacy groups, such as the National Association of Manufacturers and the Chamber of Commerce. This agency — and the rights it enforces — are under sustained attack by business groups. The Board has been prevented from issuing regulations, issuing opinions, or stepping in to resolve disputes over elections. The recess appointments and two-member rump strategy were efforts to continue doing business despite Congress’s continued failure to confirm new Board members. President Obama has responded by nominating a bipartisan package of five members (the Board is bipartisan by design), but Congress still hasn’t taken action. With insufficient members and such fierce opposition, it’s unclear at this point what the Board can do to get back on its feet.

The unemployment rate is gradually declining, but my own personal barometer — based on the admittedly unscientific measurement of questions people ask me because they know I’m an employment lawyer — shows that interest in unemployment remains high. Employers and employees want to know the same thing: What reasons for leaving a job disqualify someone from getting benefits?

Here in California, the rules about eligibility for unemployment are among the most generous in the country. An employee who quits a job for good cause can still get benefits. Good cause includes not only job-related reasons (such as dangerous working conditions or harassment) but also circumstances wholly apart from work. For example, if you quit your job because you need to relocate with your spouse, escape domestic violence, or care for an ailing family member, you will likely be eligible for unemployment benefits.

Employees who are fired can get benefits unless the termination was based on misconduct. If that sounds like a low standard, that’s only because you haven’t heard how California defines the term. An employee has committed misconduct only if all of the following are true:

• The employee owed a material duty to the employer, such as showing up for work.
• The employee substantially breached that duty: A minor or one-time transgression isn’t enough to meet this requirement.
• The employee showed a wanton or willful disregard for that duty. In other words, the employee wasn’t just careless or thoughtless but, instead, intentionally violated the duty or showed a reckless disregard for the consequences of your breach of the duty. Inefficiency, inability to perform the job, or good faith errors in judgment don’t meet this standard and won’t render someone ineligible for benefits.
• The employee’s breach tends to materially harm the employer’s business interests.

That third factor is the key that unlocks benefits for many fired employees. Poor performance, mistakes, and even incompetence are not supposed to be enough to deny benefits: The intention requirement in the standard means the employee must have been making a choice, either to engage in wrongdoing or to perform poorly. An employee who really can’t do the job is supposed to get benefits. (For comprehensive — and comprehensible — information on unemployment in California, check out the Unemployment Insurance page at the website of the always awesome Employment Law Center.)

Some of the questions I’ve been asked lately (on the employer side) kind of remind me of that old Mad Magazine cartoon, “Unclear on the Concept.” Here are a couple of examples:

Can we ask employees to waive the right to collect unemployment in a severance agreement? Only if you don’t mind breaking the law. In California, unemployment benefits may not be waived. A contractual agreement by an employee to give up the right to apply for or collect unemployment is void and invalid. What’s more, severance pay ordinarily doesn’t count as “wages,” and so doesn’t reduce the amount of benefits a former employee can collect. (If severance is paid out over time as if it were wages, the employee may have to delay collecting benefits.)

Can we ask employees to agree that failing to meet our performance standards constitutes a voluntary quit? Same answer. It really doesn’t matter what you require employees to agree to: Employees are entitled to benefits when they lose their jobs unless they commit misconduct, as defined above, or quit without good cause, also as defined above. The EDD doesn’t care how you redefine these terms in a performance improvement plan or employment contract. If an employee is terminated because of poor performance, that is not a voluntary quit. In fact, employers who try this strategy might be facing more problems than an increase in unemployment claims: Requiring employees to sign a contract that you know you can’t enforce could arguably constitute an unfair business practice, which takes an employer into territory where huge damages can be awarded.

To return to the title of this post, it is almost never in the employer’s interest to try to contest benefits this aggressively. Fighting an employee’s claim on dodgy grounds will turn the employees you still have against you: They will find out about it, and they will not be feeling the love. It will take time and money to appeal employee claims. And you will make a bitter enemy of the employee you fired, one who has every incentive to file a lawsuit against your company. By all means, challenge claims by bad apples who are trying to game the system, who truly committed misconduct, who quit for no good reason, who stopped even trying to do their jobs months before you fired them. But otherwise, it’s generally best to let the system do what it’s supposed to do: provide some help to those who have lost their jobs through no fault of their own, until they can find new work.

Last week, the Supreme Court decided a case about collective actions under the Fair Labor Standards Act (FLSA). Collective actions are similar to class actions, in that they give an employee the right to file a lawsuit on behalf of a group of employees who have the same basic claim against the employer. The Court’s decision took a strange turn, resulting in a victory for the employer that skirted a primary issue in the case.

Here’s what happened: Laura Symczyk filed a collective action against her employer, Genesis Healthcare, claiming that it had an unfair policy of docking employees for a 30-minute meal break every shift, whether or not the employee had to work during that time. (If an employee must work through a meal, the employee is entitled to be paid; nobody disputes this basic assertion underlying the employee’s case.) Symczyk was the only named employee in the case, but anticipated that others would join in once the collective action was conditionally certified: that is, once the court found that the group of employees were similarly situated to Symczyk because they were subject to the same policy or practice.

Before Symczyk tried to certify the collective action, Genesis offered to settle her claim. Genesis said it would pay her $7,500, plus fees and costs. Symczyk didn’t respond, and Genesis withdrew the offer.

This settlement offer was made under Rule 68 of the Federal Rules of Civil Procedure. Under Rule 68, if one party doesn’t accept a settlement offer, that party will be responsible for all of its lawsuit costs after the date the offer was made, unless that party gets a judgment that’s better than the settlement offer. The purpose of this Rule is to give both sides a strong incentive to settle: The defendant has good reason to offer a generous settlement, both to get out of the lawsuit and to make it more likely that the plaintiff won’t do better at trial. The plaintiff has a good reason to accept, both because the offer is likely to be generous and because the plaintiff may have to foot a large litigation bill if the judgment isn’t better than the settlement.

With me so far? Because here’s where things get weird. The trial court threw out the lawsuit, finding that Symczyk no longer had an active dispute against the company because she had been offered all of the relief to which she was entitled. Because Symczyk no longer had a claim, she couldn’t represent other employees, and so the whole case got tossed.

The problem is that Symczyk didn’t accept the settlement offer; she turned it down. She didn’t get any money in settlement and, because the court tossed her case, she won’t get any money at trial. This should not be possible: Plaintiffs who turn down a Rule 64 settlement offer have a right to take their chances in court. The plaintiffs may win or they may lose, but they buy the opportunity to take their best shot by forgoing the settlement. It isn’t fair to throw a case out when the plaintiffs have neither settlement nor judgment in hand. Nonetheless, one federal judiciary circuit has interpreted Rule 64 to allow this type of penalty, presumably in an effort to put a stop to unnecessary litigation.

But the Court skipped right past this issue to decide that, if Symczyk’s case was properly dismissed, then she can no longer represent the group. Employee attorneys take issue with this, arguing that employees should have a chance to replace the named plaintiff-employee when this happens and continue with the lawsuit. Otherwise, defendant-employers could “pick off” the named employee (by making a Rule 68 offer) and get any collective action filed against it thrown out of court.

This is an interesting argument, but not the one the Court should have decided. In almost any federal court, Symczyk’s case would not have been dismissed and she would still be capable of representing the group. By leaving this fundamental issue undecided, the Court hasn’t clarified things very much for those on either side of an FLSA collective action.

As reported in the New York Times, the Department of Labor recently released its Job Openings and Labor Turnover Survey. The survey asks employers about changes in their workforce over the past month: how many employees they started with, how many employees left or were hired, and how many employees they had at the end of the month.

The statistics show that the rate of involuntary separations — firings and layoffs – has stayed really low. Just over 1% of the total workforce were discharged or laid off in February 2013, the month for which the survey collected data. In fact, more employees quit voluntarily than were fired or laid off. However, the survey also revealed that hiring rates remain low, at 3.3%. With total separations, voluntary and involuntary, at 3.1%, you can see why the monthly job numbers continue to disappoint.

Among other things, these numbers mean that the unemployed are still quite likely to stay that way. There are just too few jobs opening up to absorb everyone who is looking for work. In response to this continuing problem, a few states and local governments — most recently, New York City — have passed laws prohibiting discrimination against the unemployed. Although these laws don’t magically expand the number of available jobs, they at least attempt to level the playing field by prohibiting employers from excluding those who are currently unemployed from consideration when hiring. For more information about these laws, and possible discrimination claims based on unemployed status, check out Discrimination Against the Unemployed.

Last week, the New York Times reported that large retail chains are pooling data on employees accused of theft, so they can avoid hiring those employees in the future (“Retailers Track Employee Theft in Vast Databases.”) That’s right: It’s an industry blacklist. And it’s not just for employees who have been convicted of theft or admitted to it. One employee interviewed for the article reported that she got into the database for failing to report another employee’s theft; another employee was reported for theft after leaving a pair of socks at a cash register.

And now the lawsuits are coming. The Federal Trade Commission is investigating whether these databases comply with the Fair Credit Reporting Act (FCRA), which requires employers who get reports on employees (such as credit reports or criminal background checks) from outside agencies to get the employee’s consent, notify the employee if the employer plans to rely on the report to take adverse action, and give the employee information on how to correct errors in the report. From the Times story and others I’ve read, it sounds like neither the employers nor the agencies gathering the alleged theft information followed these rules. (For more on the rules employers and agencies must follow, see Running Credit Checks on Job Applicants.)

But the potential legal violations go well beyond the FCRA. Many states prohibit blacklisting, for example. And, job applicants might have a claim for defamation against their former employer, if the information reported to the database is false. If there are racial or ethnic disparities in the database — for example, if a disproportionately large number of African American or Latino employees appear in its data — an employee who is turned down for a job might have a discrimination claim.

As a practical matter, the database blacklist might also lead to more claims against the former employer for wrongful termination. An employee might be willing to walk away after being fired for alleged theft, even if the accusation is false. Retail employees are often living paycheck to paycheck, and the imperative to get a new job may well outweigh the desire to clear one’s name at the old one. However, if the former employer takes steps to guarantee that the employee will never work again, the balance obviously shifts. Suddenly, a claim for defamation or false imprisonment might look a lot better if the alternative is waiting for the unemployment to run out.

Spare a thought for the employers caught in this web: Employee theft is a serious problem, accounting for almost half of all theft and $15 billion in lost merchandise in 2011, according to data From the National Retail Federation reported in the Times article. You can see why an employer would want to take any help available to avoid putting a thief on the payroll. But secret databases that report accusations and suspicions aren’t the way to do it.

It was bound to happen: All those Harlem Shake videos on YouTube have finally gotten the attention of the lawyers. According to Law.com, the Federal Aviation Association is investigating safety concerns over a Shake incident by passengers on a Frontier Airlines flight. (You will perhaps not be surprised to learn that the group was led by members of Colorado College’s Ultimate Frisbee team.) Safety concerns were also cited in the firing of a group of Australian miners for their on-the-job Shake performance. (See more in the Law.com article, When the Harlem Shake Bumps Against Workplace Policy.)

The article didn’t even scratch the surface of employees recently fired for participating in dance crazes, including an Oxford Librarian fired for allowing the filming of a Harlem Shake video at the University, and the Gagnam Style 14, a group of young lifeguards in Southern California who were fired, then rehired, after posting their homage video. Ride those horsies straight to the unemployment line, kids! Even Conan O’Brien has gotten into the act, firing an Indian chief, an astronaut, a giant banana, and someone dressed as a pillow, just as they start gettin’ their Shake on. (Okay, so this last one seems to be a parody.)

Some employment lawyers have taken this opportunity to talk about the infiltration of social media into the workplace, draining company resources and lowering employee productivity. I suppose that’s fair enough, and there may be true safety concerns when employees are getting their groove on down a mine shaft. On the other hand, some of these videos look to be real morale boosters. They can even be useful to employers: A local rescue group for older dogs (Muttville) has posted theirs — which includes people dressed as dogs and actual dogs — as a promotional video. At least we can be glad it isn’t thirty years ago, when the Streak was popular! Oh wait, it still is for this fired guy.

An Associated Press story yesterday included some lousy news for those with disabilities (and their advocates): The percentage of people with disabilities who are in the work force has declined in the last four years, and hasn’t changed appreciably since the Americans with Disabilities Act (ADA) was passed 23 years ago. According to the story (here is the Washington Post’s version), only 18% of working age Americans with disabilities are, in fact, working, compared to 63% for those without disabilities. Not reported in the article, but just as depressing, is the disability wage gap: Full-time employees with disabilities earn $6,100 less per year, on average, than full-time employees who don’t have disabilities. (You can find this figure, along with piles of other disability statistics, in the Disability Status Report.)

Conjectures about what’s still holding back employees with disabilities range from employer prejudice and outdated attitudes to compliance costs. Here’s the thing, though: Studies show that compliance with the ADA — at least in the form of providing reasonable accommodations to allow those with disabilities to perform their jobs — is not that expensive after all. In 2009, the Equal Employment Opportunity Commission pulled together various statistics and studies on the cost of reasonable accommodations, as part of the process of drafting regulations to implement the Americans with Disabilities Act Amendments Act (ADAAA). Those studies show significant variations in the reported mean cost of an accommodation, ranging from $462 up to more than $1,400. Where the studies agree, however, is that many accommodations — the majority, in some studies — are free.

In response to reader questions and search popularity, we recently added a Reasonable Accommodations page, with articles on the right to accommodation and specific accommodations for a variety of disabilities. For detailed information on accommodations for dozens of disabilities, along with compliance assistance, check out the website of the Job Accommodation Network.

Unless you’ve been hiding under a rock, you probably heard about Yahoo’s recent decision to prohibit employees from working from home. The ban, intended to promote collaboration and innovation, will start in June. Almost all of the news coverage I’ve heard and read has focused on a few angles:

• Is innovation really harmed when employees work from home? (The consensus: yes, but productivity is higher when employees work from home, in certain jobs at least.)
• Is this the start of a trend? (To quote the Magic Eight Ball, “my sources say no.” The trade-off makes sense only for companies that must innovate constantly to succeed: the serial innovators, as John Sullivan referred to them on the PBS NewsHour. And Yahoo needs to make some big changes to turn its fortunes around.)
• Isn’t it kind of ironic that perhaps the most famous working mom — other than Michelle Obama — instituted this policy? (You be the judge. Over at the Daily Beast, Ellen Galinsky points out that men are more likely than women to work mainly  from home, and more likely to be allowed to work from home.)

All interesting discussions. What interested me far more, however, was the memo that actually announced the change, sent out by Yahoo’s head of HR (and reproduced here at AllThingsD). If I were a Yahoo employee — or just a Yahoo, as the memo puts it — who had been working from home, and I received this memo, I would be pretty angry. I’m not sure if I would be angry enough to send it to the media, as a number of Yahoos apparently did, despite the all caps heading tagging the memo as “PROPRIETARY AND CONFIDENTIAL — DO NOT FORWARD.” But angry for sure.

The change in policy is bad enough from an employee perspective, especially considering that some employees may have taken the job (or turned down other offers) because of the opportunity to work from home — and arranged their lives accordingly, from child care to pet ownership to buying or renting a home that’s too far away to commute regularly. No matter where you come down on the innovation/productivity argument, or whether you think this change will ultimately help Yahoo rebound, it’s clear that an employee benefit is being taken away.

Which must have made the odd cheerleading tone of the memo hard to take. There’s no acknowledgment that this might be difficult or unwelcome for some employees. There are, however, many references to the company’s culture and identity, from what “being a yahoo” is all about to the need “to be one Yahoo!” to the company’s effort “to become the absolute best place to work.” There’s also an admonition that even Yahoos who “occasionally have to stay home for the cable guy” must use their “best judgment in the spirit of collaboration.” Seriously? Does that mean missing even a few hours of work could harm the company’s success? Could they have come up with a more frivolous reason to miss work? Using the official announcement of what is sure to be an unpopular change in company policy to tout what a “productive, efficient and fun” place you are to work is the kind of HR speak that gets internal memos sent to news outlets by angry employees. I’m just sayin’.