Court Report

Employer’s Directive for Inpatient Alcohol Treatment Upheld

Nov 1, 2008

Kozisek v. County of Seward, Neb., 8th Cir., No. 07-3682 (Aug. 27, 2008).

The 8th U.S. Circuit Court of Appeals upheld judgment in favor of an employer who terminated an individual after he refused to enter an inpatient alcohol treatment program recommended by a psychologist.

In 1994, after 13 years of employment with Seward County, Neb., as a weed-control officer, Fredrick Kozisek applied for and obtained the position of county veterans service officer (CVSO), which included work related to veterans’ issues. However, the job was considered to be a “multi-position” that also included acting as building and grounds supervisor and general assistance administrator.

Professional Pointer
The county’s success in this case was based on the fact that it obtained an opinion from a mental health professional after an incident that involved a violation of law by Kozisek. The county then acted on that recommendation without making independent judgments related to Kozisek’s impairment.

Kozisek and the county disagreed on the nature of the job, with Kozisek arguing to devote more time to veterans’ issues and less time to the other two portions of the position. Kozisek, himself a Vietnam veteran, suffered from post-traumatic stress disorder (PTSD), for which he regularly took medication. Kozisek did not inform his employer of his PTSD.

One evening in July 2005, having failed to take his prescribed medication for several days, Kozisek left work early and began drinking. Under the influence of alcohol, he then shot a number of his family’s farm animals, including the family dog, and subsequently threatened his wife. He was arrested the next morning by the county sheriff. Based on the incidents, the county and Kozisek agreed that Kozisek would get a psychological and substance abuse evaluation.

After a meeting with Kozisek, a mental health practitioner from the Veterans Administration recommended that Kozisek complete inpatient alcohol treatment. Kozisek did not want to undergo inpatient treatment, and he informed the county that he would prefer outpatient counseling and Alcoholic Anonymous meetings. The county then informed Kozisek that he had 10 days to enroll in an inpatient treatment program or lose his job. Kozisek refused and ultimately was terminated.

Kozisek then filed an Americans with Disabilities Act lawsuit claiming, in part, that he was fired because the county regarded him as disabled by alcoholism, as evidenced by its requirement that he complete inpatient treatment as a condition of his continuing employment. The lower court granted summary judgment in favor of the county.

That decision was upheld on appeal by the 8th Circuit, which found that the county’s decision was “not based upon misconceptions, myths or stereotypes” related to Kozisek’s drinking problem. Rather, it was based on a licensed mental health therapist’s recommendation of inpatient treatment.
By Maria Greco Danaher, an attorney with Ogletree Deakins in Pittsburgh.

Employment History Not Covered by FCRA

Owner-Operator Independent Drivers Assoc. Inc. v. USIS Commercial Services Inc., 10th Cir., No. 06-1430 (Aug. 19, 2008).

USIS Commercial Services Inc.’s general practice of compiling and disseminating employment history reports for motor carriers’ former truck drivers does not violate the Fair Credit Reporting Act (FCRA), the 10th U.S. Circuit Court of Appeals decided.

At issue was whether data compilations USIS prepared and disseminated to assist motor carriers in complying with U.S. Department of Transportation regulations—detailing truck drivers’ work records, eligibility for rehire, performance and other employment-related information—was a “consumer report” under the FCRA.

The FCRA regulates the distribution of “consumer reports” and sets out procedures and standards of compliance for consumer reporting agencies. It defines consumer report broadly to include any communication bearing on a consumer’s “character, general reputation, personal characteristics or mode of living” used to establish eligibility for “employment purposes.”

The statute mandates that a consumer reporting agency may only “furnish a consumer report for employment purposes” if the entity obtaining the report has received the consumer’s authorization to procure the report.

Professional Pointer
The 10th Circuit’s decision echoes the Federal Trade Commission’s interpretation of the statutory exclusion, which states that the “FCRA would not apply to any communication by a previous employer about the applicant’s job performance.”

The U.S. Department of Transportation requires motor carriers to investigate truck drivers’ employment histories and driving records before hiring. USIS sells a service to assist motor carriers in complying with this requirement by compiling and disseminating employment-related information contained on data compilations called Termination Record Forms (TRFs) prepared by the motor carriers. The TRFs contain information related to an employee’s eligibility for rehire, work record, cargo loss and other performance indicators. USIS uses the TRFs to create an employee’s employment history report. Potential employers then pay a fee to obtain an applicant’s employment history report (EHR) from USIS.

The plaintiffs were individual truck drivers whose EHRs were procured and disseminated by USIS. They sued USIS, alleging that it violated the FCRA in its collection of the TRFs. Specifically, the plaintiffs claimed that the TRFs were consumer reports obtained for employment purposes and that USIS failed to comply with the act’s notice and authorization requirement. At the close of trial, USIS moved to dismiss, arguing that the plaintiffs had not shown that the TRFs were consumer reports. The district court granted the motion.

On appeal, the 10th Circuit examined whether the TRFs were consumer reports under the FCRA. Although the definition of consumer report is broad, the court noted that the statute also contains an explicit exclusion: “any … report containing information solely as to transactions or experiences between the consumer and the person making the report.” According to the 10th Circuit, the TRFs fall under this exclusion.

The court rejected the plaintiffs’ contention that the exclusion applies to circumstances involving only the employer and the employee. “It is not necessary,” according to the court, “that the experience must be exclusively between the employer and employee.”

As long as the reports include firsthand experiences of the employer, the exclusion prevails. Thus, that the TRFs reflect that the plaintiffs routinely interacted with a wide variety of third parties in the course of their employment “does not … demonstrate that these were not the experiences of the employers.”

Indeed, the motor carriers completing the TRFs were asked questions that pertained only to their firsthand knowledge gained by employing the consumer.

In other words, the court concluded, “[t]he TRFs contain the same kind of information found in a typical letter of reference from a former employer and are not subject to the requirements of the FCRA.”

By Scott R. Eldridge, an attorney with Miller, Canfield, Paddock and Stone PLC in Lansing, Mich.

Hospital Found To Be Joint Employer of Temp

Barfield v. NYC Health and Hospitals Corp., Bellevue Hospital Center, 2nd Cir., No. 06-4137, 06-4310 (Aug. 8, 2008).

A certified nursing assistant, employed and referred by three separate temporary employment agencies to the same hospital, was considered an employee of the hospital for purposes of the Fair Labor Standards Act. The hospital thus was liable for overtime hours worked by the temp.

Professional Pointer
An employer should be aware of its potential status as a joint employer of temporary agency workers and proceed with due care in its treatment of temporary agency workers. Employers need to create a procedure or mechanism for ensuring that temps are not using referral agencies to circumvent employment restrictions, including limits on overtime work.

Anetha Barfield, a certified nursing assistant, gained concurrent employment at Bellevue Hospital in New York through three separate referral agencies. The first agency to place Barfield at Bellevue specifically noted in its policies that temporary employees were not allowed to work more than 40 hours per week. The explanation for the policy provided to Barfield was that Bellevue would not pay overtime.

Nevertheless, Barfield secured placements at Bellevue from two additional agencies. As a result, she worked more than 40 hours per week for 16 weeks during her tenure with Bellevue, although never for a single referral agency. Neither the referral agencies nor Bellevue paid Barfield overtime compensation for the weeks she worked more than 40 hours.

Bellevue works with many different referral agencies to meet its staffing needs. The agencies are expected to train temporary employees assigned to Bellevue and to carry malpractice insurance on those employees. Typically, Bellevue pays a referral agency a flat hourly fee for the services of employees referred by the agency. From that fee, the agency pays its temporary employees an hourly rate that it establishes.

In spite of the structure of the relationship between the referral agencies and Bellevue, the 2nd U.S. Circuit Court of Appeals noted that Bellevue exerted formal and functional control over Barfield’s work.

Consequently, the court found that the hospital was a joint employer and liable for overtime payments.

By W. Kevin Smith, an attorney with Smith & Smith Attorneys, a Worklaw Network member firm in Louisville, Ky

Editor’s Note: These articles should not be construed as legal advice.

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