United States: Nevada Employer Pays $3.5 Million To Settle "100-Percent Healed" Claim

Slots chain employer Dotty's recently agreed to pay $3.5 million to settle litigation alleging its "100-percent-healed" policy discriminates against disabled workers. The June 5 settlement and consent decree entered in the federal court case of EEOC v. Nevada Restaurant Services Inc. is just the most recent victory in the EEOC's campaign to target employer "maximum-leave" and "100-percent-healed" policies.

This $3.5 million price tag should serve as a reminder to all employers that the EEOC continues to target both the formal written policy limitations on medical and disability leave and employers' administration of return-to-work requests for reasonable accommodations.

Background: EEOC Targets Employer Blanket Policies

The Equal Employment Opportunity Commission (EEOC) complaint against Dotty's alleged that the company's "well-established 100-percent-healed practice" discriminated against disabled employees in violation of the Americans with Disabilities Act (ADA). Under the 100-percent healed policy, employees returning from a medical, sick, or disability leave needed to be fully recovered before being permitted to return to work. The EEOC alleged that Dotty's 100-percent-healed policy was discriminatory because it established "an unlawful qualification standard that does not allow for reasonable accommodation of qualified individuals with disabilities."

For example, under such a policy, an employee who was on FMLA leave to have knee surgery would not be allowed to return from leave until the employee was fully recovered from the surgery. This means that if an employee was released to work with medical restrictions (such as not being permitted to stand for more than two hours without sitting for 10 minutes), the employee was not considered to be fully healed and therefore could not return to work.

The concern about such a policy is that, depending on the employee's position and essential job duties, restrictions such as sitting for 10 minutes might be an easily granted accommodation under the ADA. These types of policies automatically presume that the employee cannot work but do not allow management to consider the essential functions of the position or whether an alternative position within the company may represent a reasonable accommodation. Employers with such policies frequently reject return-to-work notes that contain any limitations out of hand rather than engaging in the interactive process.

Litigation targeting employer policies regarding employees returning from medical leave have become more prevalent since the issuance of the EEOC's 2016 Guidance and the agency's designation of this area as one of its top enforcement priorities. The EEOC's guidance took the position that employers may need to extend additional leave time beyond the maximum duration provided for in a company policy as a reasonable accommodation, or perhaps offer employment in an open position. The EEOC's guidance is clear that a medical certification containing any kind of a limitation or restriction should be treated by the employer as a request for an accommodation that triggers the duty to engage in the interactive process.

The Settlement And Consent Decree

In lieu of further litigation and a potential trial, Dotty's agreed to a settlement and consent decree, which Judge James C. Mehan approved on June 5. While Dotty's did not admit any liability or wrongdoing, the terms of the consent decree show the extent of the concessions the company had to make to avoid further EEOC litigation. As part of the consent decree, Dotty's agreed to hire an equal employment opportunity monitor, revise its disability and leave policies, and implement a mandatory training program for all staff on the interactive process and other duties required by the ADA (with additional training for managers, supervisors, and human resources personnel).

Additionally, the consent decree grants the EEOC the sole discretion to determine which employees and former employees are eligible to share in the $3.5 million settlement fund and how much each class member will receive (including six months of back pay and any applicable compensatory damages the EEOC feels is appropriate). Dotty's also agreed to implement an elaborate log system to track employee requests for disability accommodations and perform an audit of the accommodations log both retroactively and annually for the next three years.

Finally, the consent decree requires the company to send notice to all potential class members and invite them to complete an online survey to determine if they are a member of the class, and even requires the company to give priority consideration to class members (former employees) when hiring for open positions. Dotty's has agreed to work with the EEOC to determine the qualifications for reemployment. The company also agreed that, in situations where a class member is found to be eligible for reemployment in a particular position but there is no open job with matching duties, it will provide notice to the EEOC within 10 days of a suitable position becoming available.

Implications Of This Settlement

It seems clear that the EEOC's trend towards litigation targeting disability leave policies is not going away any time soon. Public comments from the EEOC regarding the consent decree show that the agency views these policies as evidence of "systemic disability discrimination." The agency announced that it is on a quest to identify such policies and hold employers accountable, targeting them for enforcement lawsuits to ensure that company decision makers are complying with the ADA.

Therefore, you should treat this settlement as a warning and review all company policies procedures and practices for potential issues of disability discrimination. This area of the law is often complicated by the interplay between various statutory requirements and external and internal policy interpretations. A request by a single individual might require you to determine what your obligations are under the ADA, FMLA, state workers' compensation laws, and other state-specific statutory requirements. Make sure you don't let your comprehensive compliance efforts fall by the wayside just because you feel confident of having satisfied one specific law.

Recommendations For Employers

In light of this specific settlement and the EEOC's renewed efforts to focus on this area, you should consider tackling the following priorities:

  1. Review Written Policies
    Review your written policies on leave and confirm that your company does not have any formal policies which might be discriminatory, such as:
    • a 100-percent-healed policy (employee must be released to full-duty with no restrictions);
    • a maximum leave policy (employee is not entitled to any additional leave beyond their 12 weeks of FMLA leave); and
    • restricted "light duty" positions (only employees with workplace injuries can fill that open position).
  2. Evaluate Requests On A Case-By-Case Basis
    Address return-to-work requests on an individual basis and evaluate each employee's request to return to work as a potential request for an accommodation that might trigger the interactive process.
  3. Ensure Consistent Administration Of Leave
    Confirm that leave is carefully and consistently administered across all departments and third-party administrators. Ensure that managers, supervisors, and human resources representatives are all on the same page and follow set guidelines throughout the interactive process so that non-discriminatory company policy is not administered in a discriminatory fashion.

  4. Engage In And Document The Interactive Process
    Employer best practices include carefully documenting not only each request for accommodation, but also every stage of the interactive process. Make sure to record the ultimate conclusion reached or accommodation provided to the employee.

If you have questions regarding your leave policies, or a particular employee's requested accommodation or return to work certification, please contact the author or your Fisher Phillips attorney for further assistance.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
McLane Middleton, Professional Association
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
McLane Middleton, Professional Association
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions