Kansas City, Mo. (January 29, 2024) - This update highlights key developments in Nebraska labor and employment law in 2023, as well as how these developments will impact employers in 2024.

Nebraska Supreme Court Confirms: Wage Payment and Collection Act Does Not Provide Independent Basis For Civil Relief Separate From Employment Agreement

The Nebraska Wage Payment and Collection Act ("NWPCA") obligates an employer to pay all wages due to its employees on regular days designated by the employer or agreed upon by the employer and employee. An employee may sue his or her employer if the employer fails to pay the employee's wages as they become due. Under the NWPCA, wages are defined as compensation for labor or services rendered by an employee when previously agreed to and conditions stipulated have been met by the employee. Thus, a payment will be considered wages subject to the NWPCA if: (1) it is compensation for labor or services; (2) it was previously agreed to; and (3) all the conditions stipulated have been met.

On February 3, 2023, the Nebraska Supreme Court affirmed summary judgment in favor of a school district based on its determination that the compensation a public school teacher sought was not wages under the NWPCA because the teacher did not satisfy the conditions of the parties' agreement for maintaining a grievance and because the "wages" were not contemplated by the controlling agreement. Hoagbin v. Sch. Dist. No. 28-0017, 984 N.W.2d 305 (Neb. 2023)

After failing to follow the grievance procedure called for by his collective bargaining agreement with his school district, a public school teacher filed suit alleging that he had an individual statutory right to payment under the NWPCA that could not be waived by the collective bargaining agreement or the district's grievance rule for backpay due to errors in salary calculations for the 2015-16, 2016-17, and 2017-18 school years. During those years, the public school teacher had completed his master's degree, as well as certain postgraduate credit hours, which entitled him to a higher rate of pay. The error was discovered in October 2018 and the school district corrected the teacher's salary retroactively to the start of the 2018-19 school year in accordance with the teacher's collective bargaining agreement with the school district. Specifically, the collective bargaining agreement in effect during the applicable period of time indicated that "any error found in salary shall only be corrected retroactive to the beginning of the year in which the error was discovered or the year in which the specific error was brought to the attention of Human Resources in writing."

To support his argument, the public school teacher relied on the U.S. Supreme Court decision in Barrentine v. Arkansas-Best Freight System, 450 U.S. 728, 101 S. Ct. 1437, 67 L. Ed. 2d 641 (1981). In Barrentine, unionized truck drivers sought compensation for conducting mandatory pretrip safety inspections for which they were not getting paid. After their grievance was unsuccessful, the truck drivers filed an action against their employer under the federal Fair Labor Standards Act. The Court concluded that the act conferred statutory rights to a minimum wage and overtime pay and, thus, the provisions in the bargaining agreement to the contrary could not eclipse the statutory rights.

The Nebraska Supreme Court found the public school teacher's reliance on Barrentine to be misplaced, as the NWPCA did not declare an important public policy, which could provide an independent basis for civil relief separate from an employment agreement. The Nebraska Supreme Court specifically noted that:

in the context of wrongful discharge . . . the NWPCA does not represent a "very clear mandate of public policy," and we have declined to use the NWPCA to provide a basis for additional civil actions. Malone v. American Bus. Info., 634 N.W.2d 788, 793 (Neb. 2001). We have also noted that the NWPCA does not impose criminal sanctions. Malone v. American Bus. Info., supra. The NWPCA is designed to allow workers to enforce "substantive rights to compensation for work performed"; the right to payment of wages arises "not from the statute but from the employment relationship itself" . . . Relief, if any, under the NWPCA is specifically based on the agreement to pay the employee.

While this holding is not a departure from existing law, it reiterates the longstanding notion that an employee cannot make a claim for wages subject to the NWPCA if the employee fails to meet the conditions agreed to in his or her employment agreement. The controlling language of an applicable employment agreement can be a powerful tool for both an employee and an employer. A vague promise for compensation may be upheld against an employer given the plain reading of an agreement just as an employee's failure to follow a grievance procedure in his employment agreement may preclude recovery due to a prior year's payment error.

Nebraska Fair Employment Practice Act Does Not Protect An Employee's Opposition to the Unlawful Activities of Fellow Employees

On February 7, 2023, the Nebraska Court of Appeals affirmed a district court's holding that, among other things, an employee's disclosure of a co-employee's unlawful activities did not support a prima facie case of retaliation under the Nebraska Fair Employment Practices Act ("NFEPA"). Quiroz v. Lancaster County Sch. Dist. 0001, No. A-22-028, 2023 Neb. App. LEXIS 47. In Quiroz, a former employee of a public school district was fired for insubordination and poor performance. She filed suit against her former employer claiming that the district had retaliated against her for opposing and reporting actions she reasonably believed to be unlawful under state and federal law.

The Nebraska Court of Appeals noted that the former employee's concerns focused on the actions of her former supervisor and not those of the school district. The court noted that while the NFEPA makes it unlawful for an employer to discriminate against its employee on the basis of the employee's opposition to an unlawful practice, the NFEPA does not protect an employee's opposition to the unlawful activities of fellow employees. The "evil" addressed by the NFEPA "is the exploitation of an employer's power over the employee when used to coerce the employee to endorse, through participation or acquiescence, the unlawful acts of the employer." Baker-Heser v. State, 963 N.W.2d 59, 68-69 (Neb. 2021).

The Nebraska Court of Appeals cited to the Nebraska Supreme Court's decision in Wolfe v. Becton Dickinson & Co., 662 N.W.2d 599 (Neb. 2003), where the state high court confirmed that in order to establish a prima facie case for retaliation under Neb. Rev. Stat. § 48-1114, the alleged violation must include either the employee's opposition to an unlawful practice of the employer or the employee's refusal to honor an employer's demand that the employee do an unlawful act. If the employer is not alleged to have been involved in the alleged unlawful activity or to have endorsed such conduct, the employee is not afforded protection under the statute.

Omaha Jury Returns $36 Million in EEOC Disability Discrimination Case

On September 1, 2023, an eight-person jury in Omaha, Nebraska returned a verdict of $36,075,00 in favor of the U.S. Equal Employment Opportunity Commission ("EEOC") on disability discrimination claims against Drivers Management, LLC and Werner Enterprises, Inc. This included an award of $75,000 in compensatory damages and $36,000,000 in punitive damages based on a finding that the Nebraska trucking companies violated the Americans with Disabilities Act ("ADA").

The EEOC filed suit in the U.S. District Court for the District of Nebraska on behalf of a truck driver who alleged he was denied employment with a trucking company because he was deaf. According to the complaint, the driver obtained a hearing exemption from the U.S. Department of Transportation's Federal Motor Carrier Safety Administration ("FMCSA") for the operation of a commercial motor vehicle and completed commercial truck driving school. The driver began the interview process with the Nebraska trucking company. The driver met with a safety executive of the company to discuss use of an interpreter during training and to discuss how he could complete training given his disability. The driver answered the safety executive's questions by explaining he could use his mirrors frequently, use other senses to compensate, and write and gesture with trainers. The complaint further alleged that the trucking company did not propose any means of accommodation or look into any other means of accommodation and instead determined that it could not hire the driver because he could not hear. The driver then went to work for multiple trucking companies as a commercial truck driver.

The jury's verdict emphasizes the importance of participating in the interactive process. Both the ADA and NFEPA prohibit discrimination on the basis of disability. Disability discrimination claims brought under the ADA and NFEPA are analyzed under the same framework. Morriss v. BNSF Ry. Co., 817 F.3d 1104, 1106 n.2 (8th Cir. 2016). Both the ADA and the NFEPA require an employer to make a good faith effort to assist the employee in seeking accommodations. While many employers would like a clear road map delineating how to navigate the interactive process, there are no rigid routes for the process. Once an employee requests an accommodation, the employer must engage in a good faith and flexible dialogue that addresses the employee's specific medical limitation, request, job position, and work environment, among other factors.

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