Answers to some of the most commonly asked employment law questions.

As employment laws continue to evolve, human resources professionals turn more and more to employment attorneys for guidance on balancing legal compliance issues with effective business management. The following are some of the most commonly asked questions by human resources professionals together with answers and practical solutions.

1. When an employee with a serious health condition has taken 12 weeks of unpaid leave from work pursuant to the Family Medical Leave Act (FMLA) and/or California Family Rights Act (CFRA) and requests additional time off from work, can an employer refuse to provide additional leave and terminate the employment relationship?

Not usually. Under the California Fair Employment and Housing Act (FEHA), an employer has a duty to reasonably accommodate the known disabilities of an employee. The term "disability" is broadly defined by FEHA to include a physical or mental condition that "makes it difficult" for an employee to engage in one or more major life activities, including work. Because an employee who qualifies for leave under the FMLA/ CFRA may also be considered "disabled" under the FEHA, an employer may have a duty to provide the employee with a reasonable accommodation. Importantly, an employer must engage in an "interactive process" with the employee to determine if the employee requires a reasonable accommodation in order to perform the essential functions of the job. A reasonable accommodation includes, among other things, a leave of absence, job restructuring, part-time or modified work or reassignment to a vacant position. Thus, when an employee exhausts his FMLA/CFRA leave and requests additional time off work to recover from a serious health condition, an employer should communicate with the employee to determine if the employee is disabled under the FEHA and identify what accommodation would be reasonable under the circumstances. It is important for an employer to document any communications with the employee to avoid any claim that the employer failed to engage in an interactive process in violation of FEHA.

2. Can an employer ask an employee's health care professional to provide the employer with information regarding the employee's medical diagnosis during the interactive process?

No. To avoid liability under state and federal law, an employer should refrain from requesting or receiving any information from an employee's health care professional regarding the employee's diagnosis or other personal information without a written authorization from the employee. In the absence of such an authorization (which must comply with strict requirements), the only information that an employer should request or receive when engaged in the interactive process is: (1) a statement that the employee is unable to work or is only able to perform with certain functional limitations; (2) the date the employee became unable to work or began having functional limitations; and (3) the probable duration of the leave or limitations. California law expressly prohibits an employer from using to the employee's detriment any other confidential medical information received without an employee's written authorization.

3. Can an office romance involving a supervisor and a subordinate employee subject an employer to potential liability for sexual harassment?

Yes. In a recent case, the California Supreme Court determined that office romances that lead to widespread sexual favoritism may create a hostile work environment sufficient to support a claim of sexual harassment under the FEHA. For example, a male supervisor who becomes sexually involved with subordinate female employees and shows favoritism to those employees by giving them undeserved promotions, more favorable assignments or other employment-related benefits may send a message to other female employees that the best, and perhaps only, way of advancing one's career is to sleep with the boss. Under these circumstances, a female employee could assert a claim for sexual harassment if the sexual favoritism at work is so severe or pervasive that it alters the working conditions and creates a hostile work environment.

To prevent such harassment employers should: (1) revise and redistribute existing unlawful harassment policies to prohibit favoritism based on sex or any other protected category; (2) consider adopting a policy requiring supervisors to disclose when they become romantically involved with a subordinate employee; (3) promptly investigate all complaints of harassment or favoritism based on sex or any other protected category; and (4) ensure prompt compliance with California's new sexual harassment training requirements, which requires, among other things, employers with 50 or more employees to provide at least two hours of interactive training to supervisory employees by January 1, 2006.

4. If an exempt employee voluntarily absents herself from work for a partial day, can an employer dock the employee's pay or charge the employee's vacation leave for the partial-day absence?

Under California wage and hour law, exempt employees must be paid on a "salary basis." This means that an exempt employee must regularly receive a predetermined amount that is not subject to reduction because of variations in the quantity or quality of the work performed. There are a few narrowly construed exceptions to the salary basis rule. For example, if the employee voluntarily absents himself/herself from work for a full day for personal reasons, then the minimum salary may be subject to deduction. However, an employer may not, under any circumstances, dock an exempt employee's salary for a partial-day absence.

The question of whether an employer may charge an exempt employee's vacation leave account for partial day absences is not so straightforward. Under California law, vacation and paid time off (PTO) constitute wages. California law does not permit forfeiture of wages. Thus, an employer may jeopardize exempt status by improperly charging an employee's vacation leave or PTO leave account. While it is clear that an employer may charge an exempt employee's vacation leave account for a full day absence, the enforcement policy of the California Division of Labor Standards Enforcement (DLSE), until recently, asserted that employers could not require exempt employees to use vacation leave for partial-day absences. In July 2005, however, a California appellate court held that an employer's practice of requiring exempt employees to use vacation leave for partial-day absences does not jeopardize such employees' exempt status. However, the court limited its definition of "partial-day absence" to any absence of more than four hours in a single work day. Thus, it is uncertain whether California employers may charge exempt employees' vacation accounts for partial-day absences that are less than four hours.

Because an employee's right to paid vacation is determined, in large part, by an employer's policy or contract of employment, employers should review and appropriately revise their vacation policies before requiring exempt employees to use their vacation leave for partial-day absences.

5. When an employee who owes money to an employer is terminated or resigns, can the employer deduct the amount owed from the employee's final paycheck?

Usually not. California law generally prohibits employers from recovering employee debts by deducting the outstanding balance from the employee's final pay. This is true even where the indebtedness is evidenced by a written agreement to pay the full balance of the debt "on demand." The rationale underlying this rule is that an employer should not, simply by virtue of the employment relationship, stand in a better position than an ordinary creditor. Notwithstanding this general rule, the DLSE has stated that a "balloon" deduction from an employee's final paycheck to retire debt may be made if at or before the time of termination, the employer and employee enter into a new and valid agreement pursuant to which the employee authorizes the balloon deduction. While the DLSE's enforcement policies are entitled to some weight, they are not controlling upon California courts. Thus, employers should be aware that, even with an express written agreement executed at the time of termination, an employer may incur potential liability for making debt deductions from an employee's final paycheck.

Marie Burke Kenny is a partner in the Labor & Employment group at the law firm of Luce, Forward, Hamilton & Scripps LLP. She works with companies on preventive counseling and education to protect them from claims and create effective defenses to litigation. Kenny also represents employers in federal and state court litigation involving wage and hour claims, wrongful termination, discrimination, harassment, retaliation and unfair competition. For more information, please visit www.luce.com.