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Here is a look at legislation affecting the building industry.

Update on the Job Applicant Fairness Act

A new Oregon law generally prohibits the use of credit histories for employment purposes. Limited exceptions include federally insured banks and credit unions, businesses required by law to consider employee credit history, and police and other public employers hiring for law enforcement and airport security.

Additionally, the law includes an exception when the individual’s credit history is “substantially job-related;” however, that exception is not defined in the statute.

The Oregon Bureau of Labor and Industries issued final rules, effective today, to implement the law. The rules define “substantially job-related” under the law to mean a position where “an essential function … requires access to financial information not customarily provided in a retail transaction or that is not a loan or extension of credit.”

An employer should consider updating its employee handbook to state that it does not consider an applicant’s or employee’s credit history for employment purposes except as authorized by law. The definition of “substantially job-related” could include, for example, accounting department employees, financial advisers, and certain employees in the securities and insurance industries. If a third-party service is used to perform background checks, a written notice should be sent instructing the service not to obtain or use credit histories except when specifically instructed to do so and to comply fully with Oregon’s Job Applicant Fairness Act.

Employers need not accommodate medical marijuana users

The Oregon Supreme Court has ruled that workers who use marijuana to relieve pain or nausea may be fired for drug use even if they hold a valid state-issued medical marijuana card. In a 5-2 decision, the court held that Oregon’s medical marijuana program must yield to federal law prohibiting illegal drugs.

The Oregon Medical Marijuana Program, approved by voters in 1998, created a gray area for employers hoping to adopt tough illegal drug use policies. The decision, which overturns an earlier Oregon Court of Appeals ruling and BOLI decision, means that employers need not accommodate medical marijuana users in the workplace. A spokesperson for Associated Oregon Industries said the decision “could not be better” for employers, and added that they should now feel free to apply “zero tolerance” drug policies and refuse to hire applicants who fail drug tests regardless of medical marijuana registry status.

Employers should:

• Review policies to ensure they can – to the extent permitted by applicable federal, state and local law – discover, investigate and respond appropriately to the illegal use of drugs by employees.
• Avoid simply assuming that every employee who asks for an accommodation for the use of medical marijuana is currently using it. For example, an employee may be investigating treatment options without having used marijuana.
• Interact in the same way with all employees seeking accommodation. Some employees may be qualified employees, and there may be a duty to accommodate them with legal alternatives.
• Carefully train managers to understand the law, the rules that apply to their workplaces, and the consequences of violating those rules. There is much disinformation about medical marijuana, but the proliferation of state medical marijuana laws attests to the wide support for the limited use of marijuana for medical purposes. Managers and employees may know someone whom they believe has benefited from the use of medical marijuana. As a result, they may take actions or fail to take actions that may undermine their employer’s policies and expose those employers to civil or even criminal liability.
• If an employer does make an accommodation based on an employee’s use of medical marijuana – even though it has no legal obligation to do so – the decision may affect how it conducts its drug testing program and how it provides accommodations to similarly-situated employees. Accommodating the employee may expose the employer to civil liability for negligent hiring, supervision, or retention; violations of workplace safety rules; and violations of agreements with third parties to provide a drug-free workplace. That decision also may pose a risk to the organization or its managers of criminal liability. Accordingly, such an employer should first discuss with its legal counsel the serious ramifications of making such an accommodation.

Health care reform

The Patient Protection and Affordable Care Act of 2010 will have significant impacts on employers. After Jan. 1, 2011, new and existing employer group health plans that become effective based on the calendar year:

• may not impose pre-existing condition limitations on covered individuals under 19 years of age, and must provide dependent coverage to children until age 26. Existing plans need only cover adult children if they are not eligible to enroll in another employer-sponsored plan.
• must provide notice of any material modification to the terms of the plan, 60 days before the modification becomes effective.
• may not rescind coverage except in cases of fraud or misrepresentation.
• may not establish lifetime or annual dollar-value limits on “essential health benefits.” (The new law does not define “essential health benefits,” but guidance is expected soon from the Secretary of Health and Human Services.)

In addition, new employer group health care plans must provide coverage with no co-payments and/or deductibles for preventative care services and recommended immunizations, and must implement an appeals process for appeals of coverage or claims.  The appeals process must comply with the claims and appeals process contained in the Employee Retirement Income Security Act of 1974.

For new and existing plans that become effective between Oct. 1 and Dec. 31, these new regulations will become effective on the effective date of the plan.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or [email protected].

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at [email protected].