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October 2006 - Vol. 8, No. 10
The Employer E-Letter: Labor and Employment Law News from the Duluth, Minnesota law firm of
Hanft Fride, A Professional Association.
Editor, Kathleen S. Bray, ksb@hanftlaw.com or 218.529.2427.
Please feel free to forward this e-mail or share it with others. If there are other topics of interest to you or any other suggestions concerning this newsletter, please let us know.
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THIS MONTH'S TOPICS:
- E-DISCOVERY UNDER THE FED. RULES OF CIVIL PROC.: PRESERVING ELECTRONICALLY STORED INFORMATION
- FAMILY MEMBERS COVERED BY FMLA
- MINIMUM HOUR REQUIREMENTS FOR EXEMPT EMPLOYEES
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E-DISCOVERY UNDER THE FED. RULES OF CIVIL PROC.: PRESERVING ELECTRONICALLY STORED INFORMATION
On December 1, 2006, absent congressional intervention, amendments to the Federal Rules of Civil Procedure will take effect. These amendments primarily concern discovery of electronically stored information, or "e-discovery," as it is referred to in litigation. These amendments not only apply to attorneys, however, they require the party possessing the electronically stored information to actively participate in the discovery process.
What is electronically stored information? The Committee Note to the amended Rule 34(a) notes that "electronically stored information" is intended to be broad enough to cover all current types of computer information, including emails, and flexible enough to include future developments in technology. Thus, today, electronically stored information includes things such as e-mail and other electronic communication, word processing documents, spreadsheets, databases, calendars, telephone logs, project manager software, Internet usage files, and network access information. Tomorrow it could include something wholly different!
Once the electronically stored information is identified, a party must adequately preserve it. The duty to preserve electronic data begins once a potential party reasonably anticipates litigation. For this reason, potential parties must implement a "litigation hold" which ensures the preservation of all relevant documents. Below are some tips to aid in this process.
- Develop a document retention policy: the importance of preserving documents relevant to litigation is crucial. Most companies have a purge system on their computer servers; after a set number of days, the server will delete the file. Some companies have an automatic e-mail destruction policy, while others vest the decision to delete with the employees. Regardless of the system, once a party reasonably anticipates litigation, it must take affirmative steps to preserve relevant data. This could mean suspending an automatic e-destruction system or notifying all persons to retain relevant data.
- Start making a list of key players: identify those persons who have information in the matter that is the subject of the potential litigation. In a situation where a former employee is alleging discrimination or harassment, these people would include the former employee's supervisors, assistants, coworkers, HR personnel, and in any situation, of course, the people in the information technology (IT) department.
- Send out notice of the litigation hold in writing: although a general hold may be issued immediately, once the key players are identified, alert them that [specific] company records are relevant to litigation or potential litigation, and that they must preserve those records until legal counsel has advised the records are no longer needed. This notice should specify that it includes all records pertaining to that matter (e.g., e-mail, voice mail, calendars), including those on the person's designated computer, disks, CDs, file cabinets, and systems used outside of the corporate system such as home computers, cellular phones, and personal digital assistants (PDAs).
- Inform your attorneys: The amended Federal Rules require attorneys, before discovery in a lawsuit begins, to discuss "any issues relating to discovery of electronically stored information." Therefore, identifying for your legal counsel the following information may help answer questions related to this discovery and also help counsel understand the volume of materials that need to be reviewed and potentially produced: the type of your technology infrastructure, including the amounts and types of computers and software applications; the architecture of the e-mail system, including the server and workstation software and version, list of users, and location of e-mail files; the names of all key players in the actual or potential lawsuit; the names and contact information of any third party who holds or has access to company data; backup policies and procedures; document retention and discharge policies and procedures; and computer use policies and procedures, including employee guidelines, password use, system logging, and security controls.
The e-discovery updates to the Federal Rules of Civil Procedure are extensive and can feel overwhelming. At the core is a duty imposed on parties to preserve electronically stored information. By implementing a "litigation hold" practice, companies can escape sanctions for their failure to comply with discovery, and may even escape feeling overwhelmed by the discovery process!
If you have questions regarding the e-discovery updates to the Federal Rules of Civil Procedure, please contact Gabe Johnson at gdj@hanftlaw.com or 218.722.4766.
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FAMILY MEMBERS COVERED BY FMLA
The Family Medical Leave Act (FMLA) allows an employee up to 12 weeks of unpaid leave to care for an immediate family member with a serious health condition. Who qualifies as an "immediate family member"? The FMLA defines immediate family member as a spouse, child or parent.
The Act further defines a child as the biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis, who is either under 18 years of age or 18 years of age or older and incapable of self-care because of a mental or physical disability.
Questions regarding the FMLA or medical and disability-related issues? Contact Kathy Bray at 218.529.2427 or ksb@hanftlaw.com.
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MINIMUM HOUR REQUIREMENTS FOR EXEMPT EMPLOYEES
The U.S. Department of Labor's Wage and Hour Division occasionally issues Opinion Letters. As explained on the DOL's website www.dol.gov/esa/whd, Opinion Letters are official rulings or interpretations of the Wage and Hour Division for purposes of the Portal-to-Portal Act, 29 U.S.C. 259. Under certain circumstances, such rulings may provide a good faith reliance defense for violations of the FLSA.
In a March 10, 2006 Opinion Letter (FLSA2006-6), the Wage and Hour Division addressed the question whether properly classified exempt employees (e.g. executive, professional, administrative, etc.) could be required to work either 45 or 50 hours per week. The Division noted that hours worked is a matter of agreement between employer and employee, and so long as the employee's salaried status is not jeopardized.
The Opinion Letter explained the criteria for paying an employee on a "salary basis":
"An employee will be considered to be paid on a 'salary basis' within the meaning of these regulations if the employee regularly receives each pay period on a weekly, or less frequent basis, a predetermined amount constituting all or part of the employee's compensation, which amount is not subject to reduction because of variations in the quality or quantity of the work performed. Subject to the exceptions provided in [29 C.F.R. § 541.602(b)], an exempt employee must receive the full salary for any week in which the employee performs any work without regard to the number of days or hours worked. Exempt employees need not be paid for any workweek in which they perform no work. An employee is not paid on a salary basis if deductions from the employee's predetermined compensation are made for absences occasioned by the employer or by the operating requirements of the business. If the employee is ready, willing and able to work, deductions may not be made for time when work is not available." 29 C.F.R. § 541.602(a).
The Opinion Letter also explained that exempt employees could be required to make up work time due to personal absences of less than a day, so long as the employee's salary was not reduced due to that absence.
If you have any questions regarding wage and hour issues, contact Kathy Bray at 218.529.2427 or ksb@hanftlaw.com.
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Hanft Fride's business and trial lawyers are located at 1000 U.S. Bank Place, in Duluth Minnesota. Visit our our website at www.hanftlaw.com. In addition to general information on the firm and our attorneys, you can find past issues of this newsletter. Keep checking back for new information, and let us know if there is anything you would like to see added to the site that would help you and your organization.
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The information provided in this E-letter is general in nature and should not be used as a substitute for professional services and advice. The communication and receipt of this information is not intended to create an attorney-client relationship. Readers should consult with their legal counsel before taking any action on matters covered in this E-letter.
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To subscribe or unsubscribe to Employment Express, e-mail your request to Kathleen S. Bray, ksb@hanftlaw.com or call 218-722-4766.
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Copyright 2006 by Hanft Fride, P.A. All rights reserved. Hanft Fride, A Professional Association, 1000 U.S. Bank Place, 130 W. Superior Street, Duluth, MN 55802. Phone 218-722-4766; fax 218-529-2401.
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