In May of 2023, significant decisions in Pennsylvania federal courts yielded one of the largest wage and hour verdicts in history, and two significant medical marijuana decisions – one favoring the employee, and one favoring the employer. To find out more, the details are below.
Philadelphia Federal Court delivers Largest FLSA Verdict in History against PA Company.
A federal jury in Pennsylvania has awarded a $22 million verdict to the U.S. Department of Labor in a Fair Labor Standards Act (“FLSA”) lawsuit filed against East Penn Manufacturing Co. The verdict, which represents the largest in FLSA history, supports the claims of 7,500 workers who alleged that the company denied them overtime pay. The DOL intends to seek liquidated damages equal to the verdict amount and an injunction mandating future FLSA compliance from East Penn. The trial, presided over by U.S. District Judge Gene E.K. Pratter, lasted for 30 days. The DOL argued that the employees were not compensated for over eight hours of work, which included time spent on putting on protective gear and showering to mitigate workplace hazards. The jury’s decision is viewed as a significant victory for the workers and a reminder for employers to comply with labor laws. East Penn nevertheless deemed the verdict a favorable outcome, emphasizing that the jury rejected the majority of the government’s total wage claim that was asserted.
Steel Co. unable to avoid Medical Marijuana Discrimination Suit despite Expired MMA Card
In a Pennsylvania federal court ruling, U.S. District Judge Michael M. Baylson rejected a steelmaker’s attempt to dismiss a lawsuit filed by an engineer and medical marijuana patient. The engineer, John DellaVecchio, claimed that the company, Cleveland Cliffs Steel LLC, rescinded a job offer after he failed a drug test. Despite his expired medical marijuana card, Judge Baylson determined that DellaVecchio’s claims are protected by state law, which safeguards the medicinal use of marijuana.
Cleveland Cliffs argued that they withdrew the job offer because DellaVecchio’s medical marijuana card had expired at the time of the positive drug test. However, Judge Baylson stated that the company did not cite the expired card as the reason for termination. Instead, a representative mentioned the positive test result. The judge emphasized that the company discriminated against DellaVecchio, who had a valid prescription for medical marijuana and had renewed his card.
DellaVecchio initiated the lawsuit against Cleveland Cliffs, the largest flat-rolled steel company in North America, in December 2022. He asserted that he had accepted an associate engineer position in May 2022 and had informed the company about his medical marijuana certification during the onboarding process.
Judge Baylson noted that DellaVecchio’s valid medical marijuana card, which was renewed before the job offer was revoked, had been sent to the company. The judge inferred that DellaVecchio was discriminated against based on his status as a medical marijuana cardholder, thus suggesting a violation of the Pennsylvania Medical Marijuana Act (PMMA).
Cleveland Cliffs also argued that the PMMA does not explicitly grant the right to sue for violations. However, Judge Baylson concluded that the legislature intended to establish a private right of action under the PMMA: “Absent direct guidance from the Pennsylvania Supreme Court, it is reasonable for this court to predict that the Pennsylvania Supreme Court would rule in agreement with the Pennsylvania Superior Court and the two decisions in the Eastern District of Pennsylvania,” Judge Baylson wrote. “As such, this court finds that the legislature intended to create a private right of action under the PMMA,” the judge added. Consequently, Judge Baylson’s ruling denies Cleveland Cliffs’ motion to dismiss and indicates that DellaVecchio’s case can proceed, potentially allowing him to seek $150,000 in damages and other forms of relief.
The case is John DellaVecchio v. Cleveland-Cliffs Inc., case number 2:22-cv-04932, in the U.S. District Court for the Eastern District of Pennsylvania.
Third Circuit upholds termination after failed drug test for TCH where Employee failed to comply with reporting requirements of workplace police.
The Third Circuit Court of Appeals upheld the dismissal of a lawsuit filed by a former Toshiba employee, Cherie Lehenky, who claimed she was wrongfully terminated after testing positive for THC, which she used to treat her disability. The unanimous three-judge panel ruled that Lehenky failed to demonstrate that Toshiba’s drug-free policy unfairly targeted individuals with disabilities.
Toshiba has a drug-free workplace policy, the panel said, under which no employee can be found to be under the influence of any illegal drug or alcohol while on duty. The policy also states that the company will conduct random drug testing and that any positive test will result in termination. The policy further states that if an employee is taking a drug while at work, they need to inform the company of the drug, dosage and the prescription from an authorized doctor, or it will otherwise be treated as an illegal drug.
The panel found that Lehenky did not comply with the company’s policy, in that Lehenky did not report her TCH use consistent with those requirements. Rather, when selected for random drug testing in 2019, she warned a human resources employee that she may test positive for THC due to the over-the-counter supplement she took. When her test returned positive for THC, Lehenky said she was terminated. Lehenky, who had been employed by Toshiba for 18 years, stated that she used CBD oil derived from hemp to alleviate symptoms of her inflammatory autoimmune disease.
The panel clarified that Toshiba’s drug-free workplace policy applies to all employees and does not place a higher burden on individuals with disabilities. As Lehenky did not demonstrate that she was fired because of her disability or that Toshiba was aware of her condition, her claims of disparate impact and disparate treatment were dismissed.
The case is Cherie Lehenky v. Toshiba America Energy Systems Corp., case number 22-1475, in the U.S. Court of Appeals for the Third Circuit.
Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment. Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.
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