Justia Labor & Employment Law Opinion Summaries

A collective bargaining agreement between the Teamsters Union and Quality Custom Distribution guaranteed that the top 80% of senior employees would receive at least 40 paid hours per week. During the early months of the COVID-19 pandemic, many Starbucks stores in or near Chicago closed or reduced their hours, resulting in senior employees averaging only 30 hours a week. The Union demanded that the employer make up the difference, but the employer refused, citing an exception for Acts of God.The dispute was taken to an arbitrator, who ruled in favor of the Union. The arbitrator determined that while epidemics might be considered Acts of God, the reduction in work was primarily due to the Governor of Illinois' orders, which were not Acts of God. The employer then filed a suit in the United States District Court for the Northern District of Illinois to nullify the arbitrator's decision. The district court judge declined to nullify the decision.The United States Court of Appeals for the Seventh Circuit reviewed the case and affirmed the district court's decision. The court held that as long as the arbitrator interprets the contract, the award must stand. The arbitrator had interpreted the contract's "Act of God" clause, concluding it did not cover the Governor's orders. The court emphasized that judicial review of arbitration awards is limited to ensuring the arbitrator interpreted the contract, not whether the interpretation was correct. The court also noted that the employer's conduct in the litigation process imposed unnecessary costs and ordered the employer to show cause why sanctions should not be imposed. View "Quality Custom Distribution Services LLC v International Brotherhood of Teamsters, Local 710" on Justia Law

Kurt Beathard, a football coach at Illinois State University (ISU), was terminated from his position as offensive coordinator after posting a handwritten message on his office door that read, “All Lives Matter to Our Lord & Savior Jesus Christ.” This occurred during a period of tension and unrest on the ISU campus following the death of George Floyd. Beathard alleges that his termination was due to this personal speech, which he claims is protected by the First Amendment.The United States District Court for the Central District of Illinois reviewed the case. The defendants, Larry Lyons and Brock Spack, filed a motion to dismiss the complaint under Rule 12(b)(6), arguing that they were entitled to qualified immunity. The district court denied the motion, stating that factual development was necessary before resolving the question of qualified immunity. The court found that Beathard had made a viable claim that his speech was personal and protected, but it was premature to engage in the Pickering balancing test at the pleading stage.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court concluded that it lacked jurisdiction to hear the appeal because the district court had not made a definitive ruling on the qualified immunity defense but had instead postponed the decision pending further factual development. The Seventh Circuit emphasized that interlocutory orders, such as the denial of a motion to dismiss, are generally not immediately appealable unless they conclusively determine the issue of qualified immunity, which was not the case here. Therefore, the appeal was dismissed for want of appellate jurisdiction. View "Rogers v. Byroad" on Justia Law

Republic Airways Inc. and Hyannis Air Service, Inc. entered into individual employment agreements with pilot candidates, offering incentives in exchange for employment commitments. The International Brotherhood of Teamsters and its local unions argued that these agreements violated the Railway Labor Act (RLA) because they were not bargained for and fell outside the scope of the collective bargaining agreements (CBAs) between the parties.The United States District Court for the Southern District of Indiana dismissed the unions' complaint for lack of subject-matter jurisdiction, determining that the dispute was "minor" under the RLA and thus subject to arbitration. The court found that the resolution of the dispute required interpretation of the CBAs, which mandated arbitration.The United States Court of Appeals for the Seventh Circuit reviewed the case and affirmed the district court's decision. The appellate court held that the employment agreements were arguably justified by the broad discretionary language in the CBAs, which allowed the carriers to offer incentives and determine their terms. The court emphasized the RLA's strong preference for arbitration and concluded that the carriers' arguments were not frivolous or insubstantial. Therefore, the dispute was classified as minor and subject to arbitration, not federal court jurisdiction. The court also affirmed the dismissal of the unions' state law claim. View "International Brotherhood of Teamsters v. Republic Airways Inc." on Justia Law

Caroline Retzios was terminated by Epic Systems Corporation after she refused to be vaccinated against COVID-19, citing religious objections. She filed a lawsuit under Title VII of the Civil Rights Act of 1964, claiming that Epic was required to accommodate her religious beliefs. Epic requested the district court to compel arbitration based on an agreement Retzios had signed, which the court granted, subsequently dismissing the suit.The United States District Court for the Northern District of Illinois dismissed the case after referring it to arbitration, despite Epic's request for a stay. According to the Federal Arbitration Act, a stay should have been issued instead of a dismissal when arbitration is requested. This dismissal allowed Retzios to appeal the decision.The United States Court of Appeals for the Seventh Circuit reviewed the case and determined that the district court erred in dismissing the suit instead of staying it. However, the appellate court proceeded with the case due to the district court's actions. The appellate court found that Retzios's claims fell within the scope of the arbitration agreement she had signed with Epic. The court rejected Retzios's arguments against the enforceability of the arbitration agreement, including her claims of promissory estoppel and waiver. The court also found her objections to arbitration to be frivolous and granted Epic's motion for sanctions, directing Retzios to reimburse Epic for its legal expenses incurred on appeal. The decision of the district court was affirmed, with sanctions imposed on Retzios. View "Retzios v Epic Systems Corp." on Justia Law

Tara Osborn, a technical support specialist, was terminated by JAB Management Services, Inc., which provides prison healthcare. Osborn sued her former employer, alleging violations of state and federal employment law, including a claim that JAB Management failed to compensate her for overtime work as required by the Fair Labor Standards Act (FLSA). JAB Management moved for summary judgment on the overtime claim.The United States District Court for the Central District of Illinois granted summary judgment in favor of JAB Management. The court found that Osborn failed to comply with local rules in her response to the summary judgment motion, leading to her amended response being struck. Consequently, the court deemed JAB Management's facts as admitted and found that Osborn did not provide sufficient evidence to show she worked overtime.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court's decision, holding that Osborn did not meet her initial burden of proving she worked uncompensated overtime. The court noted that Osborn's evidence was vague, conclusory, and lacked specificity regarding her work hours. Additionally, her claims were inconsistent with other evidence in the record. The court also found that even under the relaxed just and reasonable inference standard for proving damages, Osborn's evidence was insufficient to establish the amount and extent of her overtime work. Therefore, the Seventh Circuit affirmed the district court's grant of summary judgment in favor of JAB Management. View "Osborn v JAB Management Services, Inc." on Justia Law

In 2012, Jefferies, a securities and investment-banking firm, hired Frawley as its vice chairman and global head of metals and listed products. On the same day, Jeffries hired Webb, a sales executive in the global metals group headed by Frawley at a firm they had previously worked for, and Beversdorf, a director of that group. Webb and Beversdorf signed employment contracts, consenting “that any arbitration proceeding brought with respect to matters related to your employment or this Agreement shall be brought before [Financial Industry Regulatory Authority] … or if the parties are permitted … [or] to the personal jurisdiction of the state and federal courts. “ In 2013 Jefferies decided to get out of the iron ore business and ordered Frawley to tell Webb and Beversdorf to stop trading iron ore. Frawley did not tell them but pushed for more iron ore trades. Months later, Jefferies fired the two, who sued Frawley. Frawley successfully moved to compel arbitration. The Seventh Circuit affirmed in part, concluding that Beversdorf agreed to arbitration. Webb, however, did not sign such an agreement; the document he signed was just an agreement concerning venue. Webb remains free to litigate his dispute with Frawley in federal court. View "Webb v. Frawley" on Justia Law

Dismissal for failure to exhaust collective bargaining agreement (CBA) grievance process was improper where it was unclear that CBA required resort to that process for claims under Fair Labor Standards Act (FLSA).Vega worked for Forest as a seasonal employee, subject to a CBA that included a mandatory four-step procedure culminating in arbitration to resolve employee grievances. Forest terminated Vega. At the time, Vega was owed compensation for 54 hours of work in the preceding two weeks. Forest did not tender a final paycheck, purportedly because it discovered that Vega lacked a valid Social Security number and it did not know how to lawfully make payment to him without such a number. The parties dispute whether Vega made efforts to initiate a grievance. The district court dismissed Vega’s suit under the FLSA, 29 U.S.C. 206(b), for failure to exhaust the grievance procedure. The Seventh Circuit reversed, stating that the collective bargaining agreement did not clearly and unmistakably waive Vega’s right to pursue his FLSA claim in a judicial forum. The district court did not consider whether the CBA required Vega to resort to the grievance process when he is pursuing rights granted to him by the FLSA rather than the contract itself. View "Vega v. New Forest Home Cemetery, LLC" on Justia Law

Appeal of dismissal of challenge to city’s order requiring that police officers cover tattoos was rendered moot by city’s revocation of the order. Plaintiffs, military veterans employed as Chicago police officers, have tattoos relating to their military service and religion. The department issued an order without prior notice, requiring all officers on duty or otherwise “representing” the department to cover their tattoos. The announced reason was to “promote uniformity and professionalism.” Plaintiffs complained that covering their tattoos with clothing caused overheating in warm weather and that cover-up tape irritated their skin. The complaint sought a declaratory judgment that the order violated theirs’ First Amendment rights, attorneys’ fees and costs, and “other legal and/or equitable relief.” Without addressing class certification and before discovery, the court dismissed the suit on the merits, finding that wearing tattoos was a “personal expression,” not an effort at communicating with the public on matters of public concern, and was not protected by the First Amendment. Meanwhile, the police union filed a grievance. An arbitrator ruled that the order violated the collective bargaining agreement. The city conceded and agreed to reimburse officers for expenses in complying with the invalidated policy. The Seventh Circuit directed that the judgment vacated as moot. View "Medici v. City of Chicago" on Justia Law

Dead Man’s Act barred testimony regarding now-deceased employer’s response to being told employee would file a worker’s compensation claim. Plata sued Eureka under 42 U.S.C. 2000e, claiming that he was fired in retaliation for having filed such a claim. He claimed that Bittner, Eureka’s owner, told him he was “done” after he told Bittner that he intended to file the claim. Bittner died suddenly, leaving Plata the only witness to the conversation. Eureka cited the Illinois Dead Man’s Act, 735 ILCS 5/8-301, which “forbids a party to a suit by or against a firm to testify about any conversation with a dead agent of the firm, unless a living agent of the firm was also present.” Federal Rule of Evidence 601 states that “in a civil case, state law governs the witness’s competency regarding a claim or defense for which state law supplies the rule of decision.” The Seventh Circuit affirmed that Plata could testify that he had told Bittner that he intended to file a claim, but could not testify to Bittner’s response. The courts rejected the federal claims as time-barred and unsupported by evidence, noting that Plata was a difficult litigant, whose lawyer was allowed to withdraw after Plata refused to respond to discovery requests. View "Plata v. Eureka Locker, Inc." on Justia Law

Employee stock options, when exercised, constitute compensation, on which the employer must remit taxes under the Railroad Retirement Tax Act. Beginning in 1996, the railway began including stock options in the compensation plans of some employees, taking the position that income from the exercise of those stock options was not a form of “money remuneration” that would be taxable to the railway under the Act, 26 U.S.C. 3231(e)(1), which defines “compensation” as “any form of money remuneration paid to an individual for services rendered as an employee.” The Act requires the railroad to pay an excise tax equal to a specified percentage of its employees’ wages, and to withhold a percentage of employee wages as their share of the tax. The railroad retirement tax rates are much higher than social security tax rates. The IRS, the district court, and the Seventh Circuit concluded that the exercise of the stock options was compensation. The equivalence of stock to cash is actually signaled in the statutory exceptions for qualified stock options and for other forms of noncash employee benefits. View "Grand Trunk Western Railroad Co. v. United States" on Justia Law