Category Archives: Employment Practices Liability

by | March 31, 2012 · 9:12 am

Hospitality Industry Legal Risks: Wisconsin Restaurant Sued By EEOC For "Racial Discrimination" And "Wrongful Termination"

“..(the restaurant management) made a bad situation worse by firing the man who had the guts to stand up to it…the EEOC will stand up for people (like this employee)…”

“…the EEOC is seeking back pay, job reinstatement, compensatory and punitive damages…”

A restaurant in Menomonie, Wis., is being sued by the federal government because its managers posted images of a noose, a Klan hood and other racist depictions that prompted a black employee to complain and then be fired. The U.S. Equal Employment Opportunity Commission (EEOC) lawsuit, filed Tuesday against the owners of Sparx Restaurant & Bar, alleges that Dion Miller was fired in retaliation for complaining about the racist atmosphere that the images conveyed.

According to the suit:

Miller arrived for a regular shift and found taped to the cooler a picture of black actor Gary Coleman and a dollar bill that was defaced with a noose around the neck of a black-faced George Washington. Also on the dollar bill were swastikas and the image of a man in a Ku Klux Klan hood.

Sparx’s managers told Miller that they had posted the images the evening before and insisted that it was just “a joke.”

Miller was fired within weeks of complaining for allegedly having “a bad attitude.”

The suit was filed after an attempt at a settlement with the restaurant’s owner, Northern Star Hospitality Inc., failed.

“Sparx bills itself as a ‘family restaurant’ even as its managers posted imagery which evokes shameful memories of racially motivated physical attacks and lynchings,” John Hendrickson, regional attorney for the Chicago district of the EEOC, said in a statement Wednesday announcing the lawsuit.

For more:  http://www.startribune.com/local/144690225.html

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by | · 9:12 am

Hospitality Industry Legal Risks: Wisconsin Restaurant Sued By EEOC For "Racial Discrimination" And "Wrongful Termination"

“..(the restaurant management) made a bad situation worse by firing the man who had the guts to stand up to it…the EEOC will stand up for people (like this employee)…”

“…the EEOC is seeking back pay, job reinstatement, compensatory and punitive damages…”

A restaurant in Menomonie, Wis., is being sued by the federal government because its managers posted images of a noose, a Klan hood and other racist depictions that prompted a black employee to complain and then be fired. The U.S. Equal Employment Opportunity Commission (EEOC) lawsuit, filed Tuesday against the owners of Sparx Restaurant & Bar, alleges that Dion Miller was fired in retaliation for complaining about the racist atmosphere that the images conveyed.

According to the suit:

Miller arrived for a regular shift and found taped to the cooler a picture of black actor Gary Coleman and a dollar bill that was defaced with a noose around the neck of a black-faced George Washington. Also on the dollar bill were swastikas and the image of a man in a Ku Klux Klan hood.

Sparx’s managers told Miller that they had posted the images the evening before and insisted that it was just “a joke.”

Miller was fired within weeks of complaining for allegedly having “a bad attitude.”

The suit was filed after an attempt at a settlement with the restaurant’s owner, Northern Star Hospitality Inc., failed.

“Sparx bills itself as a ‘family restaurant’ even as its managers posted imagery which evokes shameful memories of racially motivated physical attacks and lynchings,” John Hendrickson, regional attorney for the Chicago district of the EEOC, said in a statement Wednesday announcing the lawsuit.

For more:  http://www.startribune.com/local/144690225.html

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by | March 24, 2012 · 7:41 am

Hospitality Industry Legal Risks: Arizona Restaurant Chain Found Guilty Of "Pregnancy Discrimination" In Suit Brought By EEOC

“The EEOC would like to remind employers that pregnancy discrimination has been illegal for decades, and violations of the law will be met with rigorous enforcement by our agency.”

 The manager admitted in sworn testimony that he had made that statement, having been told by a company official that he could not hire pregnant women.

An Arizona federal jury returned a verdict against High Speed Enterprise, Inc., a corporation that owns five Phoenix-area Subway restaurants. The jury awarded damages to Belinda Murillo, a job applicant who claimed she was refused a position solely because she was pregnant. The suit was brought by the U.S. Equal Employment Opportunity Commission (EEOC).

According to the lawsuit, EEOC v. High Speed Enterprise, Inc. dba Subway, Murillo applied for a job at a central Phoenix Subway in May 2006. Later that month she met with the general manager who asked if she was pregnant. She said yes.

EEOC says that the manager told the applicant, “We can’t hire you because you’re pregnant.” She also reminded pregnant women that it is against the law for employers to fire them or treat them differently because they are expecting.

For more:  http://safety.blr.com/workplace-safety-news/safety-administration/Disabilities-ADA/Jury-Decides-Against-Restaurant-Owner-in-Discrimin/

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by | March 18, 2012 · 7:56 am

Hospitality Industry Employment Risks: Hotel Management Must Use Consistent Hiring And Firing Procedures To Prevent "Age Discriminiation Lawsuits"

  • Initial screening: Make sure those responsible for selecting interview candidates don’t have access to information about applicants’ race, age, sex or other protected characteristics. That alone will prevent many failure-to-hire claims. HR should take the lead and prepare applicant summaries for hiring managers to screen that contain no tell-tale information about protected characteristics. That may mean even excising names, using a candidate number instead.
  • Who hires and fires: The same individual responsible for the final decision to hire an applicant should also make the decision to fire that individual if necessary. This helps dispel the notion that a protected characteristic like race or age had anything to do with the decision. After all, why would someone hire an applicant who belongs to a protected class then turn around and fire the same person because of her race, sex, age, etc.?
  • Training: Track training to make sure each employee has the opportunity to improve job performance. Note any training offers and the employee’s response.
  • Informal audit: Review your labor pool regularly. Look for patterns that may indicate hiring bias. For example, are all employees in a particular job under age 40? If so, find out why.

For more:  http://www.businessmanagementdaily.com/29524/use-consistent-hiring-firing-processes-to-knock-down-age-discrimination-claims

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by | January 12, 2012 · 7:00 am

Hospitality Industry Legal Risks: Washington State Supreme Court To Hear Restaurant Operator's "Products Liability And Negligence Lawsuit"; Employee "Spat On Hamburger"

An appeals court asked a state supreme court for help in deciding whether to revive a case by a police officer against Burger King over a Whopper he says a worker spat on.

Bylsma sued Burger King and restaurant operator Kaizen Restaurants Inc under products liability and negligence laws. He said he suffered ongoing emotional trauma from the incident, including vomiting, nausea, food anxiety and insomnia that required professional help.

The U.S. Court of Appeals for the 9th Circuit on Wednesday asked the Washington Supreme Court to clarify whether Washington law would allow the officer to recover damages for emotional harm when he only touched, but did not eat, the contaminated burger.

Clark County Sheriff’s Deputy Edward Bylsma said in the lawsuit that he drove his police cruiser through a Burger King drive-thru in Vancouver, Washington, in March 2009. He had “uneasy feeling” about the two employees that served him, the complaint said. When Bylsma later examined the burger, he noticed a large glob of spit on the meat patty. He touched the substance, but did not eat the burger.

DNA testing revealed the saliva belonged to one of the Burger King employees, who pled guilty to assault and was sentenced to 90 days in jail, the court opinion said.

For more: http://newsandinsight.thomsonreuters.com/Legal/News/2012/01_-_January/9th_Circuit_asks_state_court_to_weigh_in_on_Whopper_spit_suit/

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by | January 11, 2012 · 11:41 am

Hospitality Industry Legal Risks: Pennsylvania Restaurant Franchise Sued For "Racial Discrimination" In Promoting Employees

“…The lawsuit …claims that Panera franchisee Covelli Enterprises discouraged managers from hiring African Americans, and then relegated them to menial, back-of-the-shop roles….”

A Panera Bread franchisee had a policy of keeping “fat, black or ugly” people off of the cash registers and out of management positions, according to a lawsuit filed in federal court today that seeks class action status.

It follows a lawsuit filed in November by a former Panera Bread manager who said he was fired under pretenses after he objected to such policies. Both Mr. Vines and the former manager are represented by attorney Sam Cordes.

Mr. Vines, who is black, worked at Panera at the Galleria in Mt. Lebanon from November 2009 through August 2011, according to the complaint. While he was there, a district manager told a store manager that Sam Covelli, of Covelli Enterprises, might give them both a “death sentence” if he saw Mr. Vines working a cash register, because Mr. Vines was a “that” — code for an African American.

Because Mr. Vines was a good employee, the store manager continued to periodically put him on the cash register, and tried to promote him, the complaint said. He was repeatedly reprimanded, however, and was not allowed to promote Mr. Vines, it said.

Mr. Vines eventually was forced to quit because of the policies, the complaint said. Mr. Cordes said he now works at another restaurant. He seeks actual, compensatory and punitive damages.

Mr. Vines seeks to represent the interests of all African Americans hired at Panera Bread branches owned by Covelli Enterprises, which is based in Warren, Ohio. Mr. Cordes said that the class of plaintiffs does not include overweight or “ugly” people.

Read more: http://www.post-gazette.com/pg/12011/1202770-100.stm#ixzz1jBDYhqK9

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by | December 7, 2011 · 7:58 am

Hospitality Industry Employment Risks: "Americans With Disabilities Act" Amendment Has Broadened Definition Of "Disability"; "Employment-Practices Liability" Claims Expected To Rise Dramatically

“…As a result of the EEOC rulings, which broaden the definition of disability to include protections for employees with, for example, cancer, diabetes or epilepsy… the definition of disability under the law was “significantly expanded” by the ADAAA, and she also expects claims numbers to grow as a result.”

“…A person with diabetes…you must provide reasonable accommodations—a place to test blood sugar, a break to take medications and time to rest…”

“…It’s cheaper to purchase (the proper Employment-Practices Liability coverage] than to defend yourself against one of these claims…”

Steps taken by federal officials to broaden the definition of “disability” is putting pressure on employers—and insurers are forecasting an increase in employment-practices liability (EPLI) claims.

The Americans with Disabilities Act Amendments Act (ADAAA), which went into effect on Jan. 1, 2009, directed the U.S. Equal Employment Opportunity Commission (EEOC) to revise its regulations “to restore the intent and protections” of the original act, and to address what lawmakers felt was a too-narrow view taken by courts of the original ADA provisions.

For more:  http://www.propertycasualty360.com/2011/12/01/ada-amendments-broader-definition-likely-to-cause

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by | December 3, 2011 · 1:50 am

Hospitality Industry Employee Risks: "Employment Practices Liability Insurance" Policies Can Protect Hotel Owners From Costly Litigation When Using Social Media In Hiring Process

For a price comparatively nominal to the cost of litigation, employers can purchase an employment-practices liability insurance policy (EPLI). An EPLI policy provides protection for the employer from the economic and noneconomic losses resulting from employment-related claims, including but not limited to claims of wrongful termination, discrimination, harassment or retaliation.

  In addition to an employer’s risk-management portfolio for social media, an employer’s overall risk management should include an EPLI policy to protect them from the costly litigation associated with labor and employment.

Employers need to have a solid social-media policy in place. This policy should:

  • Outline what constitutes inappropriate use of social media, from personal use during work hours to the type of content posted, including defamatory language about the company.
  • Address the penalties for disclosure of trade secrets on public pages, in a language and context that can be understood clearly.
  • Address disciplinary action and termination procedures for violation of social-media use in its various forms.

Many hiring professionals and employers’ first stop during the hiring process is social-media outlets to screen applicants. They turn to LinkedIn or Facebook to learn more about an applicant’s education, their friends or even their social behavior.

Sometimes, a candidate is rejected based on content found on the applicant’s social-media pages, which could include inappropriate photos or comments, references to alcohol and substance abuse, discriminatory comments, slanderous statements and/or the sharing of confidential information regarding their previous employer, proof of poor communication skills and exaggeration of their qualifications.

While the above reasons are legitimate cause for concern, and employers advantageously have social media at their disposal to prevent negligent hiring, a business can be at risk for discrimination if accessing social-media sites that contain protected class information not privileged in the normal course of the hiring process.

To mitigate this risk, employers should use outside third parties in their hiring process, including background-verification companies and/or recruiters who document content acquired on social-media sites in the candidate-selection process.

For more:  http://www.propertycasualty360.com/2011/12/01/managing-social-media-risks-a-critical-task-for-20?t=workers-compensation

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by | October 5, 2011 · 12:36 pm

Hospitality Industry Employment Liability Risks: "Employment Practices Liability Insurance" Does Not Cover Lawsuit Brought By EEOC According To A Federal Court; Insurance "Claims" Limited To Suits Brought By "Employees"

“…A federal court in Tennessee recently ruled that an employer’s employment practices liability insurance (EPLI) did not cover a $2.7 million settlement of a lawsuit brought by the EEOC… because the policy limited “claims” to proceedings brought by employees, and the EEOC was not Cracker Barrel’s employee…”

 The specific language in the policy defined a “claim” as “a civil, administrative or arbitration proceeding commenced by the service of a complaint or charge, which is brought by any past, present or prospective ‘employee(s)’ of the ‘insured entity’ against any ‘insured.’”

After 10 Cracker Barrel Old Country Store employees filed charges of race and/or sex discrimination with the EEOC, the EEOC sued Cracker Barrel under Title VII. Cracker Barrel eventually settled the underlying EEOC lawsuit, entering into a consent decree obligating it to place $2 million into a settlement fund. In addition, Cracker Barrel incurred more than $700,000 in defense costs.    

Although Cracker Barrel gave proper written notice of the EEOC lawsuit to its carrier, the Court ruled that Cracker Barrel was not entitled to recover any of the $2.7 million under its EPLI policy. The Court held that the language in the EPLI policy did not extend to the EEOC lawsuit because the policy limited “claims” to proceedings brought by employees, and the EEOC was not Cracker Barrel’s employee.

For more:  http://www.lexology.com/library/detail.aspx?g=21384c3f-95d2-424d-a68c-ecd547ebe694

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by | October 4, 2011 · 5:44 am

Hospitality Industry Employee Risks: Colorado Hotel Owners Sued By U.S. Equal Employment Opportunity Commission (EEOC) For Firing White Workers In Favor Of Hispanic Workers

“…one of the fired employees was told she was being terminated because the hotel owners preferred non-American and non-Caucasian workers ‘because it was their impression that such workers are lazy’..”

The U.S. Equal Employment Opportunity Commission is seeking back pay for employees that federal officials said were fired from a Hampton Inn franchise in Craig, Colo., according to the lawsuit filed last week.

Former employees at a western Colorado hotel said they were fired and replaced with Latino workers because the business owners thought white and non-Hispanic workers were lazy, according to a federal lawsuit announced Monday.

The lawsuit claims the general manager of the hotel was told by the business owners “to hire more qualified maids, and that they preferred maids to be Hispanic because in their opinion Hispanics worked harder.”

For more:  http://www.businessweek.com/ap/financialnews/D9Q51LLO1.htm

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