Private Education Matters: April 2024

Private Education Matters

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discrimination

Supreme Court Clarifies Low Burden For Employees To Establish Harm Supporting Discriminatory Job Transfer Claims Under Title VII.

On April 17, 2024, the Supreme Court of the United States clarified the standard of harm an employee must demonstrate to support a discriminatory job transfer claim under Title VII of the Civil Rights Act.

In a unanimous decision, the Court held in Muldrow v. City of St. Louis that an employee challenging a job transfer under Title VII need not show that the allegedly discriminatory transfer produced a significant employment disadvantage. Rather, an employee need only show that the transfer brought some harm with respect to an identifiable term or condition of employment.

The Court’s decision overturned precedent in the Eighth Circuit, and other Circuits, mandating that employees challenging a transfer under Title VII must meet a heightened threshold of harm requirement, described as “significant,” “serious,” “materially adverse,” or by similar terms establishing a heightened bar. As the Court explained, to demand “significance” where the law does not require it inappropriately adds words to what Congress enacted. The language of the law only requires that employees show an allegedly discriminatory transfer brought about some “disadvantageous” change in employment terms or conditions.

The practical effect of Muldrow is that employees challenging a job transfer under Title VII will have an easier time establishing that the transfer produced some harm sufficient to support their claim. In his concurring opinion, Justice Alito speculated the ruling would not effectively alter how the statute is interpreted, explaining that lower courts may reach similar conclusions as before, just with careful wording of their decisions to comply with the terminology of the new Muldrow opinion.

Still, the ruling should allow a larger percentage discriminatory transfer claims to survive to trial

or settlement, and will likely result in more such claims being filed. Schools should certainly take care to ensure that job transfers and other employment decisions are made without discriminatory motive or impact.

Notably, the transfer in question in Muldrow involved a fairly significant change in assignment for a long-time, respected police sergeant.

Sergeant Jatonya Clayborn Muldrow worked as a plainclothes officer in the St. Louis Police Department’s specialized Intelligence Division for nearly ten years. In that role, she investigated public corruption and human trafficking cases, and oversaw the Gang Unit and Gun Crimes Unit. By virtue of her position, Sgt. Muldrow was also deputized as a Task Force Officer with the FBI, granting her FBI credentials, an unmarked take-home vehicle, and the authority to pursue investigations outside of St. Louis.

Sgt. Muldrow’s job performance was exceptional. In 2017, the outgoing commander of the Intelligence Division referred to her as a “workhorse” and considered her his most reliable sergeant. But the Intelligence Division commander told the Department that he wanted to replace Sgt. Muldrow with a male officer. The new commander – who often referred to Sgt. Muldrow as “Mrs.” rather than “Sergeant” –testified that a male officer seemed like a better fit for the Division’s dangerous work.

The Department approved the transfer and Sgt. Muldrow was transferred to a uniformed position. While her rank and pay remained the same, her responsibilities, perks, and schedule changed. Sgt. Muldrow no longer worked with high-ranking officials on priority matters in the Intelligence Division. Rather, her new duties involved supervising day-to-day activities of neighborhood patrol officers and handling various administrative matters. Sgt. Muldrow lost her FBI status and vehicle, and her work week went from a traditional Monday-throughFriday week to a rotating schedule that included weekend shifts.

The Court found that Sgt. Muldrow’s allegations, if proven true, “left her worse off several times over,” and noted that it did not matter that her

rank and pay remained the same or that she could still advance to other jobs. Title VII prohibits making a transfer based on sex with the consequences Sgt. Muldrow described.

Note:

This case is especially relevant for schools as they consider shifting teachers to different positions at the start of each school year.

Muldrow v. City of St. Louis (2024) ___U.S.___ [___L. Ed.2d___].

The EEOC Issues Final Regulations And Interpretive Guidance Regarding The Pregnant Workers Fairness Act.

On April 15, 2024, the Equal Employment Opportunity Commission (EEOC) issued final regulations regarding the federal Pregnant Workers Fairness Act (PWFA). The EEOC’s new regulations and accompanying Appendix A (Interpretive Guidance) provide guidance on how the EEOC interprets and will enforce the PWFA.

The PWFA took effect June 27, 2023 (42 U.S.C. Sections 2000gg ‒ 2000gg-6) and applies to both public and private employers with 15 or more employees. The PWFA requires covered employers to provide “reasonable accommodations” to employees with “known limitations” that are “related to pregnancy, childbirth, or related medical conditions,” unless provision of the accommodation would cause the employer an “undue hardship.”

The final regulations issued by the EEOC provide indepth guidance to employers, over 400 pages, on critical aspects of the PWFA, including the following:

• Individuals who are covered by the PWFA, including applicants and former employees.

• What the terms “pregnancy” and “childbirth” mean as used in the PWFA as well as the medical conditions that are or may be covered by the PWFA as relating to pregnancy or childbirth.

• Guidance concerning the fact-specific analysis required by employers in order to determine whether an employee’s medical condition is covered by the PWFA.

• What it means for an employee’s limitation to be “known” to an employer and what is required in order for an employee to request an accommodation.

• When and under what circumstances employers may seek additional information related to an employee’s request for accommodation.

• What types of modifications or adjustments to an employee’s working conditions are considered reasonable accommodations, including a detailed, but non-exhaustive, list of examples and illustrations of reasonable accommodations in specific cases.

• When a particular accommodation will be considered an undue hardship for an employer and the host of factors that are relevant to this factspecific determination.

• The purpose and requirements of the informal, interactive process that is required between the employer and the employee seeking accommodation under the PWFA.

• Additional guidance on other employment practices other than discrimination that are unlawful under the PWFA.

• Clarification on defenses available to employers, including those based on religion, and when an employer may assert such defenses in the EEOC’s charging process.

• The relationship between the PWFA and other federal laws that provide protection for individuals affected by pregnancy, childbirth, or related medical conditions, including, but not limited to, the Americans with Disabilities Act (ADA), Title VII of the Civil Rights Act of 1964 (Title VII), the Family and Medical Leave Act (FMLA), and the Fair Labor Standards Act (FLSA), among others.

The final regulations were published in the Federal Register on April 19, 2024, and will go into effect 60 days after publication, or June 8, 2024.

California state law provides protections for employees affected by pregnancy, childbirth, or related medical conditions, including under the Pregnancy Disability Leave (PDL) law and the Fair Employment and Housing Act (FEHA), that, in certain circumstance, may be greater than the protections under the PWFA. As such, it is important for employers to provide covered

employees the most generous benefits and most stringent protections for which they qualify, whether under federal or state law.

Note:

Liebert Cassidy Whitmore has attorneys who are familiar with the new PWFA regulations and can assist schools to modify existing policies or practices to ensure that they comply with the new legal regulatory obligations.

Workplace Violence Prevention Plan Deadlines Approaching!

With the enactment of Senate Bill 553, the legislature amended Labor Code section 6401.7 and added Labor Code section 6401.9, requiring employers to adopt and implement a Workplace Violence Prevention Plan (WVPP) and corresponding training for their employees by July 1, 2024. As the effective date for these statutory requirements rapidly approaches, LCW has developed a number of resources to help employers develop a WVPP for their worksites and training for their employees in order to comply with these new obligations. (See here for additional information about LCW offerings and here for a special bulletin on the same topic).

Option 1:

Comprehensive package including LCW’s model WVPP and template training materials along with instructions with valuable insight and explanation as to how to customize the WVPP for your unique workplace specific issues as well as how to implement and maintain an effective WVPP moving forward. This training will also provide detailed guidance regarding the customization of LCW’s training materials to effectively train your employees on issues specific to your workplace(s).

Option 1 Purchase Includes:

• Model Workplace Violence Prevention Plan (with notes on how to customize for your organization)*.

• Checklist of plan/training requirements.

• Slides you can customize and use to train your workforce.

• Three-month access to the two hour webinar recording which provides instructions on how to customize both the Plan and the training (recording length: two hours).

Option 2:

Model Workplace Violence Prevention Plan annotated on how to update for your agency.

Option 2 Purchase Includes:

• Model Workplace Violence Prevention Plan (with notes on how to customize for your organization)*.

The Department of Industrial Relations (DIR) has recently updated their guidance on these requirements. LCW’s WVPP complies with these guidelines.

Titleix

U.S. Court Of Appeals For The Fourth Circuit Holds Section 501(C)(3) Status Does Not Subject A Non-Profit Organization To Title IX Requirements.

Title IX is a law that prohibits discrimination on the basis of gender by educational institutions receiving federal assistance. Generally, private schools that do not receive federal financial aid have not been considered subject to Title IX’s requirements.

In July of 2022, we issued a Special Bulletin regarding a California District Court’s decision in E.H. v. Valley Christian Academy (2022) Case No. 2:21-cv-07574MEMF, which held otherwise. In that decision, the court held that a private school’s federal tax-exempt status as a 501(c)(3) non-profit corporation constituted “federal financial assistance” for the purpose of subjecting the school to Title IX requirements. The lawsuit subsequently settled. To date, neither the Ninth Circuit Court of Appeals, which has jurisdiction over California, nor other courts in California, have ruled on this issue and Title IX does not define the term “federal financial assistance.”

In our prior Special Bulletin, we referenced a similar court decision from Maryland in Buettner-Hartsoe v. Baltimore Lutheran High School Association d/b/a Concordia Preparatory School. In that case, several women sued their former high school, Concordia Preparatory School, alleging they were subjected to

sexual assault and harassment by male students at the school in violation of Title IX. The school argued the lawsuit should be dismissed because, as a private school that did not receive federal financial assistance, it was not subject to Title IX. The district court held that because the school received a federal tax exemption as a 501(c)(3) organization, it was subject to Title IX, regardless of the fact the school did receive any federal funding.

On March 27, 2024, the U.S. Court of Appeals for the Fourth Circuit, which has jurisdiction over Maryland, reversed the district court’s decision and concluded that Section 501(c)(3) status does not constitute receipt of federal financial assistance for purposes of subjecting an organization to Title IX. In its analysis, the Court explained that “federal financial assistance,” means the taking or accepting of federal financial aid, help, or support, whereas an organization’s 503(c) status is the withholding of a tax burden, rather than the affirmative grant of funds.

Note:

While the Fourth Circuit’s decision is not binding in California, the decision is instructive, and one that California courts and the Ninth Circuit may consider. If you have any questions, contact a member of LCW’s private education practice group.

Buettner-Hartsoe v. Balt. Lutheran High Sch. Ass'n (4th Cir. Mar. 27, 2024) 2024 U.S. App. LEXIS 7229.

settlement agreements

Court Finds Potential Breach Of Contract For College’s Failure To Provide Retirement Benefits To Outgoing President.

On July 1, 2011, Herbert Swender entered into an Employment Agreement with Garden City Community College whereby Swender would serve as the College’s next president. The Employment Agreement outlined Swender’s various job duties and responsibilities, as well as his annual salary and benefits.

On April 10, 2018, some female students attended a Board of Trustees’ meeting to voice complaints of experiencing sexual harassment on campus. In deciding how to react, Swender consulted his chief of security, human resources director, and an attorney. All three individuals advised Swender to serve the students with an indefinite “No Trespass Order,” which would prohibit those students from frequenting campus. The attorney drafted the No Trespass Order and told Swender it was “good and valid.” The No Trespass Order did not specify a termination date or detail if the students could appeal it for review.

Shortly after serving the students with the No Trespass Order, the students obtained counsel to investigate the College’s policies and procedures. After a few months of discussion with the students’ attorneys, the College lifted the No Trespass Orders. These events also ultimately resulted in an agreement for Swender’s resignation.

On August 6, 2018, the College and Swender entered into a Separation Agreement, which stated that Swender’s employment with the College would immediately terminate, but the College would retain him as an independent consultant through the end of

the year. The Separation Agreement also stated that Swender would receive his normal salary and benefits through January 1, 2019, and would not be subject to any reduction or setoff.

Under Swender’s Employment Agreement, one of his benefits was coverage under the Kansas Public Employees Retirement System (KPERS). This program invests a portion of the contributor’s paycheck into a retirement system, so that when the contributor retires, KPERS will pay a lifetime monthly benefit. Under the terms of the Separation Agreement, Swender thought he would retain this benefit through January 1, 2019. On the other hand, the College believed Swender was no longer an employee as of August 7, 2018, and the College notified KPERS that it no longer employed Swender as a full-time public employee.

Then, in February 2020, the students sued the College and numerous school administrators, including Swender. The students settled their claims in February 2023. Although Swender was a party to the settlement agreement, he did not participate financially and paid no money to the students.

Swender filed suit against the College alleging breach of contract, among other claims.

The College asked the Court to dismiss the breach of contract claims. The Court found that Swender and the College willingly entered into two contracts: The Employment Agreement and the Separation Agreement.

Swender argued that parts of the Separation Agreement were necessarily incorporated and relied upon parts of the Employment Agreement—namely, the parts that detailed his annual salary and benefits. Swender argued that he agreed to step down as president in exchange

for the continuation of salary and benefits. Although the Separation Agreement did not explicitly list Swender’s present salary and benefits, the Employment Agreement did, and in fact, listed KPERS coverage among the benefits. Swender argued that the College breached the agreement when it reported Swender’s last day of employment as August 7, 2018, and subsequently lost out on those benefits.

The College argued that the breach of contract claim was barred because of the release clause in the Separation Agreement.

Here, the Court concluded that Swender signed the Separation Agreement on August 6, 2018, releasing all claims that he had at the time of signing. The release did not cover actions taken after signing the Separation Agreement, and Swender claimed that the College breached the agreement on August 7, 2018, when they notified KPERS of the change in employment status.

The Court denied the College’s motion to dismiss the breach of contract claim. The remainder of Swender’s claims were dismissed due to the statute of limitations tolling.

Note:

This case serves as an important reminder that the terms of a separation agreement (or any contract) may reference another document, and schools need to ensure they are in compliance with both.

Swender v. Garden City Cmty. Coll. (D.Kan. Mar. 29, 2024) 2024 U.S.Dist.LEXIS 57767.

Arbitration Agreement Not Binding Where Employee Resigned And Then Returned To Job Without Signing New Arbitration Agreement.

Jasmine Vazquez began working for SaniSure through a staffing agency in July 2019. She was hired directly by the company as an at-will employee that November. As part of her hiring, she was given an arbitration agreement. Subject to limited exceptions, she agreed that any claim she had against the company would be determined exclusively by binding arbitration. Changes to these agreements, if any, could only be made in writing.

Vazquez resigned from her position in May 2021. Four months later, she negotiated a new employment offer and returned to work for the company. During negotiations, the parties did not discuss the arbitration agreements. Vazquez’s second stint of employment with the company ended in July 2022.

In October 2022, Vazquez filed a class action complaint under the Private Attorneys General Act alleging that SaniSure failed to provide accurate wage statements during her second stint of employment. The following month, SaniSure submitted a “cure letter” to Vazquez and the Labor and Workforce Development Agency (LWDA) indicating that they corrected their wage statements to comply with the Labor Code. SaniSure also requested that Vazquez submit her claims to binding arbitration.

LWDA concluded that the violations had not been cured. SaniSure moved to compel arbitration. The trial court denied the motion, stating that the complaint arose out of Vazquez’s second stint of employment. SaniSure failed to show that Vazquez agreed to arbitrate claims arising from that second stint, nor did the company show existence of an implied agreement to submit claims to arbitration during the second stint. SaniSure appealed.

The Court of Appeals stated that the party seeking to compel arbitration bears the burden of proving that an agreement to arbitrate exists. Here, the Court of Appeals found that Vazquez revoked the arbitration agreement when she resigned in May 2021. Vazquez did not sign a second agreement when she returned to SaniSure and SaniSure failed to show that the parties agreed that the agreements Vazquez signed during the first stint would apply to her second stint. Vazquez testified that she never agreed that the agreements she signed during her first stint of employment would govern her second. She also said that SaniSure never told her that getting rehired was contingent upon agreeing to arbitration. The documents Vazquez signed upon rehire did not mention arbitration.

The Court of Appeals upheld the trial court’s ruling.

Note:

Schools should be aware that once this employee resigned, the prior arbitration agreement was no longer in effect. Schools that do have arbitration agreements should make sure to ask rehired employees to sign them again.

Vazquez v. Sanisure, Inc. (Apr. 3, 2024) ___Cal.App.5th___ [2024 Cal. App. LEXIS 226].

Family Must Pay Full Tuition Amount For Withdrawing Children After Enrollment Agreement Cancellation Date.

In February 2019, a family enrolled their four children at Francis Parker School for the academic year from September 2019 to June 2020. They enrolled via a thirdparty website the School used to provide a platform for enrollment of students, payment of tuition, and purchase of tuition refund plan for students who withdraw.

The language in the enrollment agreement stated that by signing, the parents agreed they were responsible for the full amount of tuition and timely payment of tuition when the student was accepted. The enrollment agreement provided for a cancelation date of June 14, 2019, after which the tuition became nonrefundable. The enrollment agreement noted that tuition would not be refunded in the event the student withdrew or was dismissed for any reason at any time, regardless of whether another student was enrolled. The enrollment agreement also contained language that the School had a right to collect unpaid tuition via a collection agent or legal action.

The parents electronically signed the enrollment agreement and paid in installments, which required them to purchase a tuition refund plan from third party, A.W.G. Dewar, Inc. The tuition refund plan allowed the family to recover 75 percent of unused tuition if children withdrew for certain reasons.

On August 30, 2019, the parents withdrew. At that time, they had made tuition payments totaling roughly $30,000 and with interest and other charges, owed approximately $100,000 more.

The School filed a complaint to recover the unpaid portion of the tuition, asserting that the parents had breached the contract. Then, the School filed a motion for summary judgment, arguing there was no dispute that the family withdrew their children after the tuition became due, the tuition was nonrefundable, and the family did not pay the full amount.

The trial court ruled in favor of the School, holding that the tuition agreement was a valid contract and that the family breached the contract by refusing to pay after tuition became due. The parents appealed.

The Court of Appeals concluded that the School met its burden for establishing breach of contract. The School showed that a contract existed; that the School had reserved spaces for the four children for the 20192020 academic year and budgeted and planned in consideration of their enrollment for the year; that the parents withdrew after the tuition became due; and that the parents still owed the outstanding balance.

On appeal, the parents argued for the first time that the tuition agreement’s provision that the full amount of tuition was nonrefundable after June 14, 2019 relieved the School of any duty to mitigate damages, and therefore was an unenforceable liquidated damages clause. The School argued that the parents forfeited this argument by not making it at the trial court level.

The Court of Appeals agreed with the School. The Court reasoned that the tuition agreement allocated to the parents’ risk that their children would not attend. The language in the contract was clear and unambiguous and the family could not bring up these new arguments on appeal. The Court of Appeals affirmed the trial court’s judgment.

Note:

This case shows the importance of a well-crafted and clear enrollment agreement.

Francis Parker Sch. v. O'Brien (2023) ___Cal.App.5th___ [2023 Cal. App. Unpub. LEXIS 7568].

Court Upholds Parent’s Obligation To Pay Full Tuition After Enrollment Agreement’s Cancellation Date.

Hawken is a college preparatory day school located in Ohio. On January 15, 2021, Sandra Machado electronically executed two enrollment agreements with Hawken on behalf of her children, G.M. and J.M. for the 2021-2022 academic school year. At the time

agreements

the agreements were executed, Machado paid deposits totaling $3,000. The Enrollment Agreements were countersigned by Hawken.

The Enrollment Agreements contained express provisions concerning the cancellation of enrollment, including that the parents are liable for the entire year’s tuition and fees unless canceled on or before May 1, 2021. The Enrollment Agreement also contained a provision that if enrollment is canceled between May 1 and before July 1, 2021, the parents are obligated to pay 50% of the annual tuition fees; if enrollment is cancelled after July 1, 2021, the parents are obligated to pay 100% of the annual tuition and fees. The enrollment agreement also contained a finance charge provision, stating that the parents must pay a finance charge on the outstanding balance equal to 0.5% for each month the balance remains outstanding (up to 6.17% per year). The Enrollment Agreement stated that the total amount due, including the finance charges, were considered liquidated damages between the parties of the agreement.

On July 21, 2021, Machado sent an email to Hawken’s Director of Flexible Tuition and Associate Director of Enrollment, notifying Hawken she was cancelling the children’s enrollment for 2021-2022.

On March 20, 2022, Hawken filed a civil complaint, alleging that Machado failed to make payments and owed the School $56,800. The School filed a motion for summary judgment, arguing Machado was liable for the entire year’s tuition and fees for each student based upon the language in the enrollment agreement and Machado’s failure to provide written notice of cancellation before May 1, 2021. Hawken argued that the Enrollment Agreement’s cancellation provision and the agreedupon damages set forth within it contained a valid and enforceable liquidated damages clause.

Machado argued that she was entitled to judgment because Hawken provided no educational services to her children for the 2021-2022 academic year, the cancellation provision did not apply because the children were enrolled before May 1, 2021, and the demand for $56,800 was an unenforceable penalty and not a valid amount of liquidated damages.

The trial court ruled in favor of the School, entering judgment in the amount of $56,800 with an interest rate of 6.17%, plus costs. Machado appealed.

On appeal, Machado argued that the trial court should have stricken Business Analyst Debra Green’s affidavit from the School’s motion for summary judgment because it was a “sham bordering on frivolous.” Green’s affidavit provided factual information about Machado’s disenrollment and described the School’s multi-year budgeting process, including the considerations given to pooled students’ net tuition revenue. The affidavit stated there were no students on the waitlist in the two classes that Machado’s children were enrolled in.

The Court of Appeals concluded that Green’s affidavit (1) authenticated the dates the enrollment agreements were executed; (2) authenticated the date Machado provided notice of enrollment; (3) verified Machado’s failure to pay; and (4) generally described Hawken’s budgetary process. The Court of Appeals found no inconsistency between her affidavit and deposition, and did not interpret the affidavit as establishing Green as an expert in the field. The Court of Appeals found no evidence that the affidavit was a “sham.”

Machado also argued that she was entitled to summary judgment because her materials show she had no obligation to comply with the deadlines in the Enrollment Agreement and that the liquidated damages clause was unenforceable as a penalty.

It is not disputed that Machado electronically executed the Enrollment Agreements and subsequently canceled them after the cancellation period had passed. The Court of Appeals concluded that the contract was clear. A parent who enrolls their child before May 1, 2021, was liable for the entire year of tuition, unless a written notice is provided on or before May 1, 2021. The School reserved a spot for the Machado children in exchange for the deposit and a promise to pay the balance later that year. Machado’s ability to unilaterally repudiate the agreement without further payment obligations expired on May 1, 2021.

In terms of the liquidated damages provision, the Court of Appeals found the amount reasonable and not to be a penalty. The Court considered Hawken’s multi-step budgeting process, which relies extensively on projected enrollments and pooled student net tuition revenue, which is used to pay for staff salaries and benefits, department budgets, student materials, maintenance, improvements, and utilities. The Court of Appeals found that the School makes irreversible financial commitments to teachers and staff based on the enrollment commitments.

The Court of Appeals considered that Machado was familiar with Hawken’s enrollment process and there was no evidence she was pressured or coerced into executing the Enrollment Agreements. The Court of Appeals found the cancellation date to be reasonable. It found it reasonable that the damages Hawken suffered to be proportional to the full tuition.

The Court of Appeals upheld the trial court’s ruling.

Note:

This case is another example of the importance of a well-crafted enrollment agreement, especially the language about liquidated damages. Here, the Court allowed the School to collect the full tuition amount for both students, even though neither student attended the upcoming school year.

Hawken Sch. v. Machado (Ct.App.) 2024-Ohio-1060.

immunizations students

California Court Upholds Elimination Of Personal Belief Exemptions For Student Vaccine Requirements.

Four mothers with school-aged children who reside in California brought suit against Rob Bonta, the California Attorney General, alleging that their religious beliefs forbid them from vaccinating their children. The mothers argued that their children are unable to enjoy the benefits of public and private education because California’s compulsory vaccination law requires all students to receive vaccines.

By way of background, prior to January 1, 2016, students could apply for medical and personal belief exemptions to the immunization requirement. Since January 1, 2016, personal belief exemptions have been prohibited and school authorities cannot unconditionally admit any child to preschool, kindergarten through sixth grade, or seventh grade, unless the child has been immunized or qualifies for other exemptions. Personal belief exemptions on file at a private or public school are honored through each of the designated grade spans (i.e., birth to preschool; kindergarten and grades one to six; and grades seven to twelve), until the unvaccinated child enrolls in the next grade span.

There are exceptions. First, California’s immunization requirements are not required for any child in a home-based private school or a child enrolled in an independent study program. Second, children who qualify for an individualized education program (IEP) may not be prohibited from accessing special education or related services based on vaccination status. Third, children may be medically exempt from immunization requirements if a licensed physician states in writing that the child cannot be immunized due to physical or medical circumstances.

On October 31, 2023, the four mothers filed a complaint for injunctive relief, challenging the immunization law under the Free Exercise Clause of the First Amendment.

To merit protection under the Free Exercise Clause, a religious claim must be sincerely held, rooted in religious belief, and not purely secular. The right to exercise one’s religion, however, does not relieve an individual of the obligation to comply with a valid and neutral law of general applicability on the ground that the law requires conduct with which the person’s religion conflicts.

The Court noted that the Supreme Court has long endorsed state and local government authority to impose mandatory student vaccinations in order to protect the health and safety of other students and the public at large.

The Court concluded that while the mothers’ objections were rooted in sincerely held religious beliefs, the vaccination law was a neutral law. The Court found no hostility to religion—the law makes no reference to religion or religious practice, nor does it target or single out religion for harsher treatment. It requires all children in public and private schools to receive common childhood vaccinations.

The Court also looked at the legislative history and found no evidence of anti-religious motivations in enacting the law. According to the legislative history, the law was introduced in response to the 2015 measles outbreak in California and reports from the Centers for Disease Control (CDC) that there were more measles outbreaks in January 2015 than in any one month in the twenty years prior. The legislative history also identified concerns over the significant rise in personal belief exemptions—a 337% increase between 2000 and 2012—which places communities at risk of preventable diseases.

Finally, the Court concluded that the law was generally applicable because it did not selectively impose burdens only on conduct motivated by religious belief. Medical exemptions are framed in objective terms—a child is exempt if the parent files with the governing authority a written statement by a licensed physician. The state’s interest in enacting this law is to protect the health and safety of students and the public at large from the spread of infectious diseases. The Court found that the risks posed by the law’s

exemptions were not comparable to the personal belief exemption.

In light of these findings, the Court found that the state has a legitimate interest in protecting the health and safety of students and the public at large and that the repeal of the personal belief exemption is rationally related to furthering that interest. The Court granted the defendant’s motion to dismiss.

Note:

This case upholds the current law in California, which is that schools cannot unconditionally admit any student unless the student has been fully immunized. Schools are required to file a written report on the immunization status of new students to the school with the State Department of Public Health and the local health department on at least an annual basis at times and on forms prescribed by the State Department of Public Health.

Royce v. Bonta (S.D.Cal. Mar. 25, 2024) 2024 U.S.Dist.LEXIS 52973.

new to the Firm!

Lia Maria Fulgaro, an Associate in our Los Angeles office, specializes in labor and employment law matters. With a wealth of experience in the legal field, Lia’s expertise encompasses a wide range of areas, including complex wage and hour class action defense and representation of clients in single-plaintiff employment claims.

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Fafsa

Governor Signs Assembly Bill 1887 Extending The Deadline For Students To File The FAFSA Application For 2024-2025 Award Year To May 2, 2024.

On March 25, 2024, Governor Newsom signed Assembly Bill 1887 (AB 1887), which extends the deadline to file the federal Free Application for Federal Student Aid (FAFSA). AB 1887 is urgency legislation, which becomes effective immediately. This means this bill became effective on March 25, 2024.

Existing law establishes the California Student Aid Commission. The California Student Aid Commission is the state agency responsible for the administration of state-authorized student aid programs available to students attending all segments of postsecondary education.

Existing law provides that the FAFSA application must be available to students on or before October 1, 2023, and if it is not available by then, the deadline to file the FAFSA application extends to April 2, 2024.

AB 1887 extends the application deadline by one month. The FAFSA application deadline is now May 2, 2024. AB 1887 was adopted as urgency legislation to ensure students have sufficient time to complete the application, which provides access to federal Pell Grant awards, Cal Grant awards, Middle Class Scholarship Program Awards, and institutional aid programs at institutions of higher education.

Note:

AB 1887 amends Section 22 of Chapter 20 of the Statutes of 2023.

LCW In The News

To view these articles and the most recent attorney-authored articles, please visit: www.lcwlegal.com/news.

• Recently featured in The Recorder, LCW Senior Counsel David Urban and Attorney Gabriella Kamran authored an article which explores employee rights concerning political activity. They emphasize, "California is one of several states with laws that restrict private employers from interfering in the political activities of employees." Public employees have First Amendment protection, while California labor laws shield private employees. The scope of "political activity" is broad, safeguarding employees in social and political causes. Given complex legal issues, employers should seek legal counsel before acting.

cases we are watching

LCW will monitor these cases for future developments:

• Ameer Hasan Loggins, a Black Muslim Stanford University lecturer filed suit against the University under the California Fair Employment and Housing Act for placing him on paid leave while investigating a lecture he taught. The lecture occurred on October 11, four days after Hamas launched an attack on Israel, and Loggins asked students to play the role of the oppressed and the oppressor based on their physical size during a class simulation. When other professors found out about the lecture, they called Loggins anti-Semitic and the University placed him on paid leave while it launched an investigation. The investigation concluded and Stanford determined there was no intentional discrimination, but that the actions were unwise given that it was a freshman course and students were unprepared for such a heavy topic. Because Loggins’ contract was set to expire in a week, Stanford said it would keep Loggins suspended until his contract ended and it would not be renewed. Loggins’ suit argues that these actions were retaliatory in nature.

• Four colleges and a group of higher education advocacy groups have urged the Eleventh Circuit Court of Appeals through amicus curiae briefs to reject an argument that Emory University should have been liable for the suicide of a student. In this case, the student was a highly accomplished student who enrolled at Emory at 16 years old. While at Emory, he developed a relationship with an older female student who manipulated him and controlled his communications. The relationship turned abusive. The student told his academic advisory about his relationship troubles and mental health issues. The student committed suicide, and his parents argued the University should have intervened to prevent his death, including by training the academic advisor on how to respond to

student showing risk factors for suicide. The amicus briefs warn that a ruling against the University could bring about a radical shift in the university-student relationship because it would require universities to closely monitor the mental health of thousands of students and could dissuade students from seeking help for fear of an overreaction by their school.

• Yaakov Markel, a factory worker, filed suit against the Union of Orthodox Jewish Congregations of America (OU). From 2011 to 2018, Markel worked at two facilities that OU had contracts with to make sure the grapes used for wine were kosher. During that time, Markel worked overtime but did not receive pay because he was allegedly misclassified as an independent contractor. A California trial court found that OU did not owe him overtime because he fell under the ministerial exception. Markel appealed, arguing that the exception did not apply to him because he was not a minister. OU argued that Markel was a minister because he used his religious training and knowledge to ensure the grape production met kosher requirements.

• Beverly Buck Brennan, a white professor recently won $750,000 in a lawsuit against Harris-Stowe State University, a historically Black College and University. Brennan taught speech and theater at the University from 1993 to 2017 and alleged that after a new dean of the School of Arts and Sciences and a new provost for academic affairs came to the University in 2010, her job shifted. For example, budgets for her classes were cut, her courses were offered less frequently and in worse areas of campus, the dean repeatedly yelled at her and other women, and her concerns about workplace conditions were ignored. Brennan complained that she was retaliated against when she complained about the treatment. The jury found that Brennan was subject to a hostile work environment.

did you know...?

• The Occupational Safety and Health Standards Board recently voted to adopt a proposed indoor heat illness standard. The final standard has not yet been adopted, but some of the general requirements including the following: establishing and maintaining a Heat Illness Prevention Plan (which may be incorporated into an employer’s existing Injury and Illness Prevention Program); training on heat illness topics; maintaining one or more “cool-down areas,” which must be kept below 82 degrees; allowing and encouraging preventive cooldown rests; providing free drinking water; observing employees during heat waves; and developing emergency response procedures. There are additional requirements when temperatures exceed 87 degrees, such as using air conditioners, ventilation, or other measures to reduce the air temperature. This standard will very likely apply to private schools and LCW will monitor this standard for developments.

• Last month, the National Labor Relations Board (NLRB) approved an agreement settling a case against Lucid Group, Inc. (Employer), an electric vehicle manufacturer in Oakland, based on the Employer’s severance agreement, which contained an unlawful confidentiality provision. In the settlement agreement, the Employer agreed to revise its severance agreement to remove the overbroad confidentiality provision, to not seek enforcement of the provision, and to post and email notice to all employees. This settlement follows the NLRB’s February 2023 decision in McLaren Macomb, which prohibited overbroad confidentiality and nondisparagement provisions in settlement agreements.

• More than a dozen former and current college athletes recently sued the National Collegiate Athletic Association (NCAA), accusing the NCAA for violating their Title IX rights by allowing University of Pennsylvania swimmer Lia Thomas, a transgender woman, to participate in the 2022 national championships. The lawsuit argues that the NCAA’s transgender eligibility policies adversely impact female athletes in violation of Title IX and seeks to prevent the NCAA from enforcing these policies at upcoming events. At the same time, the National Association of Intercollegiate Athletics (NAIA) recently decided that transgender women may not compete in its collegiate women’s sports moving forward. NAIA oversees 249 small, mostly private colleges and their approximately 83,000 student athletes. This appears to be the first collegiate athletic association to implement such a rule.

• The Vice Chair of the Equal Employment Opportunity Commission (EEOC), Jocelyn Samuels, recently stated that the Supreme Court’s decision on race-conscious university admission policies does not apply to the vast majority of private employers’ diversity, equity, and inclusion efforts. Samuels noted that the Supreme Court’s case did not involve Title VII, the federal law that prohibits discrimination in the workplace. This area of the law is facing increased scrutiny following the Supreme Court’s decision last summer. Please reach out to LCW with any questions on DEI practices in hiring.

benefits

Employer Who Failed To Update Terminated Employee’s Address Did Not Ensure Receipt Of COBRA Notice.

Damion Schinnerer was the Assistant Vice President of Biomedical Engineering at Wellstar, a Medicare/Medicaid certified hospital facility. Wellstar placed Schinnerer on administrative leave on May 18, 2021 and then terminated his employment on October 1, 2021. Wellstar asserts Schinnerer was terminated because he mistreated other employees by being disrespectful and abrasive towards them.

Wellstar used a third-party company called WageWorks to send Schinnerer a notice for continued health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA). WageWorks sent Schinnerer’s COBRA notice to a home address in Marietta, Georgia. However, Schinnerer moved sometime between the start of his administrative leave in May 2021 and termination on October 1, 2021. He sold his house in Marietta, Georgia and had all his mail forward to his parent’s address in Forth Worth, Texas. Since he was on administrative leave at the time of his move, Schinnerer was unable to change his listed address in Wellstar’s system. He did, however, call Wellstar’s Human Resources to provide his new address around the end of August 2021. Since WageWorks had sent the COBRA notice to Schinnerer’s former address, he did not receive it until months after his termination.

Schinnerer filed a lawsuit against Wellstar, which included claims of retaliation for engaging in protected activity and failure to timely notify him of his COBRA rights. COBRA requires plan administrators to use “measures reasonably calculated to ensure actual receipt” of the

COBRA notice. (29 C.F.R. section 2520.104b-1(b)(1).)

Wellstar’s position was that it complied with the COBRA notice requirement because Wellstar timely mailed the COBRA notice through first-class mail. The district court found that regardless of the way the COBRA notice was mailed, it was mailed to the wrong address. There was no dispute that Schinnerer had notified Human Resources of his new address by phone. The district court could not find that Wellstar used measures reasonable calculated to ensure actual receipt of the COBRA notice. The district court denied Wellstar’s motion for summary judgment on the COBRA notice claim, therefore allowing Schinnerer to proceed with that claim in his lawsuit.

Schinnerer v. Wellstar Health, Inc., 2024 WL 476960 (N.D. Ga. 2024).

Note:

Schools are advised to have procedures in place for obtaining the most current residential address information of employees, including employees on leave. If an employee notifies the School of a new residential address, the School should prioritize updating the information in its personnel system, particularly for employees who may be terminated or otherwise separate from employment.

Beware Of Companies

Misrepresenting Nutrition And Wellness Costs As Pre-Tax Medical Expenses.

Every once in a while, the IRS issues a reminder for employers and individuals to be cautious of what expenses can be reimbursed pre-tax as a medical expense. On March 6, 2024, the IRS issued an alert warning people to beware of companies misrepresenting nutrition, wellness, and general health expenses as eligible for pre-

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tax reimbursements under a health flexible spending arrangement (health FSA), health savings account (HSA), health reimbursement arrangement (HRA), or medical savings account.

According to the IRS alert, some companies claim that a simple doctor’s note based merely on self-reported health information can substantiate a non-medical food, wellness, or exercise expense into a pre-tax medical expense. The IRS debunks these claims by explaining that such doctor’s note would not meet the requirement that the expense be related to a “targeted diagnosisspecific activity or treatment.” In previous IRS guidance, the IRS has explained that these types of expenses only qualify as medical expenses when prescribed or recommended by a physician or medical practitioner as treatment for a specific medical condition diagnosed by a physician. (See IRS Frequently Asked Questions About Medical Expenses Related to Nutrition, Wellness, and General Health.)

The IRS alert provides the following example of a food expenses that would not qualify as a medical expense:

For example: A diabetic, in his attempts to control his blood sugar, decides to eat foods that are lower in carbohydrates. He sees an advertisement from a company stating that he can use pre-tax dollars from his FSA to purchase healthy food if he contacts that company. He contacts the company, who tells him that for a fee, the company will provide him with a ‘doctor’s note’ that he can submit to his FSA to be reimbursed for the cost of food purchased in his attempt to eat healthier. However, when he submits the expense with the 'doctor's note', the claim is denied because food is not a medical expense and plan administrators are wary of claims that could invalidate their plans.

The IRS also cautions employers and individuals that if a health FSA, HSA, HRA, or medical savings account provides a pre-tax reimbursement for a non-medical expense, it is not a qualified plan. If a plan is not qualified, all payments made to taxpayers under the plan, including reimbursements that were for actual medical expenses, are taxable and includable in income.

For more information, see IRS News Release IR-2024-65 (March 6, 2024).

Internal Revenue Code Compliance Question:

Question: Can a health flexible spending account (health FSA), health savings account (HSA), or health reimbursement arrangement (HRA) provide reimbursements for medical care expenses that an employee resells or plans to resell to someone else?

Answer: No. Health FSAs, HSAs, and HRAs cannot provide reimbursements for medical care expenses that an employee resells or plans to resell to someone for two reasons. First, health FSAs, HSAs, and HRAs cannot reimburse expenses incurred by anyone other than the employee, their spouse, or their dependent. Second, IRC section 213(a) specifically limits tax deductions to expenses “not compensated for by insurance or otherwise.” If an employee were to resell an item that a health FSA, HSA, or HRA has reimbursed, then the item would be compensated for by “otherwise” since it is paid for by the resale buyer.

Consortium Call Of The Month

Members of Liebert Cassidy Whitmore’s consortiums are able to speak directly to an LCW attorney free of charge to answer direct questions not requiring in-depth research, document review, written opinions or ongoing legal matters. Consortium calls run the full gamut of topics, from leaves of absence to employment applications, student concerns to disability accommodations, construction and facilities issues and more. Each month, we will feature a Consortium Call of the Month in our newsletter, describing an interesting call and how the issue was resolved. All identifiable details will be changed or omitted.

Question: Answer:

A school administrator reached out to LCW and asked whether they had to submit a pay data report to the California Civil Rights Department.

The attorney advised that California law requires private employers of 100 or more employees to annually report pay, demographic, and other workforce data to the California Civil Rights Department (CRD). Since the School has 114 employees, the attorney advised that they must submit the annual report, which is due to the State on May 8, 2024. The attorney directed the School to the CRD website, which has a user guide, excel templates that employers may use to submit their data, examples of submissions, and answers to frequently asked questions. The website also has a link to the Pay Data Reporting Portal, through which the School can submit their data to the CRD.

lcw best timeline

MARCH - END OF APRIL

The budget for next school year should be approved by the Board.

Issue contracts to existing staff for the next school year.

Issue letters to current staff who the School is not inviting to come back the following year.

Assess vacancies in relation to enrollment.

Post job announcements and conduct recruiting.

• Resumes should be carefully screened to ensure that applicant has necessary core skills and criminal background and credit checks should be done, along with multiple reference checks.

Summer Program

• Advise staff of summer program and opportunity to apply to work in the summer, and that hiring decisions will be made after final enrollment numbers are determined at the end of May.

• Distribute information on summer program to parents and set deadline for registration by end of April.

• Enter into Facilities Use Agreement for Summer Program, if not operating summer program.

Transportation Agreements:

• Assess transportation needs for summer/next year.

• Update/renew relevant contracts.

MAY

Complete hiring of new employees for next school year.

Complete hiring for any summer programs.

If service agreements expire at the end of the school year, review service agreements to determine whether to change service providers (e.g., janitorial services, if applicable).

• Employees of a contracted entity are required to be fingerprinted pursuant to Education Code Section 33192, if they provide the following services:

ƒ School and classroom janitorial.

ƒ School site administrative.

ƒ School site grounds and landscape maintenance.

ƒ Pupil transportation.

ƒ School site food-related.

• A private school contracting with an entity for construction, reconstruction, rehabilitation, or repair of a school facilities where the employees of the entity will have contact, other than limited contact, with pupils, must ensure one of the following:

ƒ That there is a physical barrier at the worksite to limit contact with pupils.

ƒ That there is continual supervision and monitoring of all employees of that entity, which may include either:

Each month, LCW presents a monthly timeline of best practices for private and independent schools. The timeline runs from the fall semester through the end of summer break. LCW encourages schools to use the timeline as a guideline throughout the school year.

ƒ Surveillance of employees of the entity by School personnel; or

ƒ Supervision by an employee of the entity who the Department of Justice has ascertained has not been convicted of a violent or serious felony, which may be done by fingerprinting pursuant to Education Code Section 33192. (See Education Code Section 33193).

If conducting end of school year fundraising:

Raffles:

• Qualified tax-exempt organizations, including nonprofit educational organizations, may conduct raffles under Penal Code Section 320.5.

• In order to comply with Penal Code Section 320.5, raffles must meet all of the following requirements:

ƒ Each ticket must be sold with a detachable coupon or stub, and both the ticket and its associated coupon must be marked with a unique and matching identifier.

ƒ Winners of the prizes must be determined by draw from among the coupons or stubs. The draw must be conducted in California under the supervision of a neutral person who is 18 years of age or older.

ƒ At least 90 percent of the gross receipts generated from the sale of raffle tickets for any given draw must be used to benefit the school or provide support for beneficial or charitable purposes.

• 50/50 raffles may only be conducted by major league sports nonprofits.

Auctions:

• The School must charge sales or use tax on merchandise or goods donated by a donor who paid sales or use tax at time of purchase.

ƒ Donations of gift cards, gift certificates, services, or cash donations are not subject to sales tax since there is not an exchange of merchandise or goods.

ƒ Items withdrawn from a seller’s inventory and donated directly to nonprofit schools located in California are not subject to use tax.

ƒ For example, if a business donates items that it sells directly to the School for the auction, the School does not have to charge sales or use taxes. However, if a parent goes out and purchases items to donate to an auction (unless those items are gift certificates, gift cards, or services), the School will need to charge sales or use taxes on those items.

Liebert Cassidy Whitmore