News and Insights

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Author: Ashley Petefish

Under Section 7 of the National Labor Relations Act (the “Act”), employees have the right to engage in “protected concerted activities” for the purpose of collective bargaining, or other mutual aid or protection.[1]  While employers typically associate the Act and the National Labor Relations Board (“NLRB”) with complaints involving unions, the Act protects employees’ exercise of their Section 7 rights even when a union is not involved. In recent years the NLRB has continued to expand its scope of review of nonunion employers.

What Does the Act Protect?

Section 7 of the Act protects employees’ rights to:

  •     Discuss the terms and conditions of their employment;
  •     Criticize or complain about their employer; or
  •     Criticize or complain about their terms or conditions of employment.

Closely related to Section 7 of the Act is Section 8(a)(1), which makes it unlawful for an employer to “interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in [Section 7].”[2] Essentially, an employer violates Section 8(a)(1) if it maintains workplace rules that would reasonably tend to “chill employees in the exercise of their Section 7 rights.” Section 8(a)(3) prohibits employer “discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization.”[3]

What Does this Mean for Employers?

Recently, in Boeing Company, 365 NLRB No. 154 (2017), the NLRB established a new standard for evaluating whether workplace rules, policies, or employee handbook provisions unlawfully interfere with employees’ Section 7 rights. Under Boeing, the NLRB will balance the impact an employer’s proffered rule may have upon an employee’s Section 7 rights to engage in protected concerted activity against the employer’s business justification for the rule. The NLRB designated three categories of employment policies, rules, and handbook provisions that they will address.

Category 1 will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights, or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule. Examples of Category 1 rules are rules requiring employees to abide by basic standards of civility.

Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.

Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule. An example of a Category 3 rule would be a rule that prohibits employees from discussing wages or benefits with one another.

The NLRB further stated that “[a]lthough the maintenance of Category 1 rules (and certain Category 2 rules) will be lawful, the application of such rules to employees who have engaged in NLRA-protected conduct may violate the Act, depending on the particular circumstances presented in a given case.”[4] Therefore, even if employers have policies that may fall under Category 1 or 2, the policies must be implemented fairly and in a way that does not violate an employee’s rights under the Act.

The NLRB previously set its eye on healthcare employers with policies prohibiting the discussion of working conditions outside of the workplace. The NLRB, including the Phoenix, Arizona Regional Office, has been heavily scrutinizing healthcare employers’ handbooks for policies and procedures relating to workplace civility, social media and internet usage, and confidentiality requirements that may impact an employee’s ability to speak to anyone outside of the employer’s organization about employment conditions.

Healthcare employers are particularly susceptible to these violations because many employers implement strict confidentiality requirements due to HIPAA privacy concerns. This effort to ensure patient privacy may result in overly broad confidentiality policies which go beyond protecting health information and threaten to chill employees’ rights to discuss working conditions outside the workplace. Similarly, in an effort to facilitate a positive patient experience, healthcare employers often impose workplace civility rules that ban “negativity” or mandate a “positive attitude.”  As described above, employers must carefully balance the need for such policies against its potential to chill an employee’s right to complain about working conditions.

Employers, especially healthcare employers, should review their handbooks and policies to ensure compliance with the Act. If an employer has any doubt as to whether its policies or procedures do not comply with the Act, it should consult with employment counsel to take steps to update its policies and procedures to comply with the law. This summary does not encapsulate the full requirements under the National Labor Relations Act or other federal or state employment laws and it is not a substitute for legal advice. If you have any questions regarding the National Labor Relations Act, or would like assistance with updating your policies and procedures to conform under the law, please feel free to contact Milligan Lawless, P.C.

[1] 29 U.S.C. § 157

[2] 29 U.S.C. § 158(a)(1).

[3] 29 U.S.C. §158(a)(3).

[4] Boeing Company, 365 NLRB No. 154, at 14 fn.15.

 

Miranda A. Preston

On April 30th, 2018, Dr. Rita Luthra was convicted of violating the HIPAA Privacy Rule and of obstruction of a criminal health care investigation.  A federal jury found that Dr. Luthra allowed a pharmaceutical sales representative to access her patient records and lied to federal investigators. Criminal charges under the federal Anti-Kickback Statute (“AKS”) were alleged initially but subsequently dropped.

Dr. Luthra’s conviction stems from her involvement with a pharmaceutical sales representative with Warner Chilcott. Warner Chilcott was the subject of a criminal investigation by the U.S. Department of Justice (DOJ) in 2015.  The investigation resulted in Warner Chilcott pleading guilty to a felony charge of health care fraud and agreeing to pay $125 million to resolve criminal and civil liability arising from alleged illegal marketing practices of certain drugs.

According to the government, the Warner Chilcott sales representative asked Dr. Luthra to participate in the company’s speaker program because Dr. Luthra prescribed a high volume of osteoporosis medication. Dr. Luthra agreed and spoke at medical education and speaker training events held in her office. The events involved Dr. Luthra speaking to the sales representative for about thirty minutes while she ate food provided by the representative for Luthra and her office staff. Warner Chilcott paid Dr. Luthra approximately $23,500 for her services.

In January 2011, Warner Chilcott launched a new osteoporosis drug which Dr. Luthra prescribed. Many insurance companies required a prior authorization before covering the new drug. In response to receiving numerous denials for Dr. Luthra’s prescriptions for the new drug, she asked the sales representative to assist one of her medical assistants with obtaining prior authorizations. The sales representative agreed, was given access to Dr. Luthra’s medical records to complete the prior authorizations, and filled out the prior authorizations.

Dr. Luthra later provided false information to OIG investigators when interviewed about her relationship with Warner Chilcott. She was convicted of a criminal violation of HIPAA for the improper disclosure of her patients’ protected health information to the sales representative. It is illegal to knowingly disclose protected health information in violation of the Privacy Rule. Most HIPAA enforcement activities are in the form of civil enforcement. However, the Privacy Rule also establishes criminal penalties for certain wrongful disclosures of protected health information.

Dr. Luthra’s sentencing has not yet been scheduled. Nonetheless, Dr. Luthra’s HIPAA violation provides for a sentence of up to one year in prison and/or a fine of up to $50,000. The obstruction conviction carries a higher potential penalty of up to five years in prison and a fine of up to $250,000.

While criminal prosecutions of HIPAA violations are rare, this case serves as a reminder that HIPAA is more than a series of privacy and security rules; HIPAA establishes criminal liability and potential jail time for HIPAA violations. This case reflects the DOJ’s continuing scrutiny of physician-pharmaceutical manufacturer relationships, particularly those that can affect health care decision making. Providers should be mindful of their relationships with pharmaceutical companies, and third parties who may have access to protected health information. Moreover, if a provider is the subject of an investigation, he or she should be truthful and engage competent counsel at the early stages of the investigation.

For more information, or if you need assistance with an investigation or evaluating whether your relationships comply with HIPAA, please contact Miranda Preston or another health care attorney at Milligan Lawless.

 

Arizona has recently passed new law[1], and issued new regulations[2], governing physician duties and requirements in prescribing opioid analgesics or benzodiazepines.

The law mandates that, beginning October 1, 2017, physicians must consult a prescription monitoring program (PMP) prior to prescribing an opioid analgesics or benzodiazepine in schedules II-IV.

Under the new regulations, Arizona health care institutions must establish and implement more comprehensive plans and procedures for prescribing or ordering an opioid or administering an opioid.

Physicians who prescribe opioids, and health care institutions licensed by Arizona’s Department of Health Services, should be aware of this new law, and new rule. If you have any questions regarding these new laws, or would like assistance with updating your policies and procedures to conform to these requirements, please feel free to contact Milligan Lawless.

 

[1] SB 1283 (2016), signed by Arizona Governor Doug Ducey in 2016 amended A. R. S. § 36-2606.

[2] 9 AZ Adc. Ch.10, Ariz. Admin. Code R9-10-120.

 

Click Here to Read the Rest of the Article

Read Ashley’s Biography Here

 

In November 2016, Arizona voters passed a ballot initiative (Proposition 206) for a statewide sick time law and annual increases to the minimum wage.  The new law, entitled the Fair Wages and Healthy Families Act, takes effect on July 1, 2017.  The purpose of this article is to provide an overview of the law’s paid sick time requirements and the steps employers should be taking to ensure compliance with those requirements.

Take note that the following information is intended as a summary only.  Employers are strongly encouraged to seek legal counsel should they have additional questions regarding the new law’s requirements.  Additionally, employers should be aware that certain requirements may be subject to changes or further clarification as the courts and the Industrial Commission provide additional guidance on the new law.

What is Paid Sick Time?

The new law requires employers to provide paid sick time to all full-time, part-time, and temporary employees.  Paid sick time, which must be compensated at the employee’s current pay rate, may be used for the following reasons:

  • An employee’s medical care, illness, injury, or health condition
  • Care of an employee’s family member with an illness, injury, health condition, or need for medical care
  • A public health emergency
  • Issues related to domestic violence, sexual violence, abuse, or stalking affecting the employee or employee’s family member

The law broadly defines “family member” to include children and stepchildren of any age, parents and stepparents, spouses and domestic partners, grandparents, siblings, in-laws, and other individuals related by either blood or affinity whose close association with the employee is the equivalent of a family relationship.

What Arizona employers are subject to the paid sick time requirements?

Virtually all employers, including small businesses, are subject to the law’s requirements.  State and federal employers are exempt.

How much sick time does the law provide employees?

Regardless of the size of the employer, employees must accrue paid sick time at the rate of no less than one hour for every 30 hours worked.

Employees working for employers with 15 or more employees are entitled to accrue and use up to a maximum of 40 hours of paid sick time per year.

Employees working for employers with less than 15 employees are entitled to accrue and use up to a maximum of 24 hours of paid sick time per year.

Accrual of paid sick time begins July 1, 2017.  Employees may use paid sick time as soon as it is accrued; however, employers may require employees hired after July 1, 2017 to wait 90 calendar days after the start of employment before using accrued paid sick time.

What if an employer already provides paid time off to employees?

If employers already have policies that provide paid time off in an amount that meets or exceeds the law’s minimum requirements (and that can be used for the same purposes specified by the law), they are not required to provide additional paid sick time to employees.

Additionally, the law does not prohibit or discourage employers from implementing more generous paid leave policies, i.e., providing employees with paid time off above the law’s minimum requirements.

What if an employee has unused paid sick time at the end of the year?

The new law provides employers with two options regarding an employee’s accrued, unused paid sick time:

  • Employers may allow employees to carry over any accrued, unused paid sick time into the next year; or
  • Employers may pay employees for the accrued, unused paid sick time at the end of the year and provide those employees with an amount of paid sick time that meets or exceeds the requirements of the law and that is available for the employee’s immediate use at the beginning of the subsequent year.

Regardless of what option an employer chooses, employees are still only entitled to use the amount of paid sick time required under the law (up to a maximum of 40 hours per year) unless the employer has provided a higher limit.

Employers are not required to pay an employee for any accrued, unused paid sick time upon termination of the employee’s employment.  If the employee is rehired by the employer within nine months of the termination of employment, however, the employee’s previously-accrued paid sick time must be reinstated.

How does an employee request use of paid sick time?

Employees may submit requests to use paid sick time orally, in writing, electronically, or by any other means acceptable to the employer.  When the need to use paid sick time is foreseeable, an employee must make a good faith effort to provide advance notice and should attempt to schedule such time in a manner that is not unduly burdensome to the employer’s operations.  When the need to use paid sick time is not foreseeable, an employer may only require advance notice if it has previously given the employee a written policy outlining the procedures for providing advance notice.

Employers cannot require that employees find a replacement worker when requesting use of paid sick time.

Can employers require employees to document or discuss the details of a need to use paid sick time?

In the event that an employee uses paid sick time for three or more consecutive work days, employers may require reasonable documentation that the paid sick time was used for one of the reasons specified under the law.

Employers cannot require employees to specify the relevant health issue or the details of domestic violence, sexual violence, abuse, or stalking that gave rise to the need to use paid sick time.

Are employers required to give employees notice of their rights under the new law?

At the commencement of an employee’s employment or by July 1, 2017, whichever is later, employers must provide employees written notice of the following:

  • The fact that employees are entitled to paid sick time
  • The amount of paid sick time that their employees are entitled to accrue
  • The terms of using paid sick time
  • That retaliation against employees who request or use paid sick time is prohibited
  • That each employee has the right to file a complaint if paid sick time is denied or if the employee is subject to retaliation for requesting/using paid sick time
  • The contact information for the Industrial Commission

Industrial Commission Labor Department

800 West Washington Street

Phoenix, Arizona 85007

(602) 542-4515

The notice should be posted alongside other required workplace notices/posters.

Are there other recordkeeping requirements?

Employers must provide employees with the following information either in or on an attachment to the employee’s paycheck:

  • The amount of paid sick time available for use by the employee
  • The amount of paid sick time taken by the employee to date in the year
  • The amount of pay the employee has received as paid sick time to date in the year

What are the consequences for failing to comply with the law’s requirements?

The law prohibits discrimination and retaliation against employees who use or request paid sick time. Paid sick time counts as a protected absence and cannot lead to any disciplinary or adverse action against an employee. The law creates a rebuttable presumption that any adverse employment action taken within 90 days of an employee’s use of paid sick time is retaliatory.  An employer must show by clear and convincing evidence that the adverse employment action was not in retaliation for the employee’s use of paid sick time.

Employers who fail to comply with the law’s requirements are subject to the following:

  • Civil lawsuits brought by the state and/or employees
  • Payment of double the wages owed to an employee, plus interest
  • Employee attorney fees and costs
  • Civil penalties
  • State monitoring and inspections

What should employers do to prepare for the new law?

  • Employers should review current time off policies to ensure that they meet the requirements of the new law. Policies that include “use it or lose it” requirements, as well as policies that prohibit employees from accruing paid sick time until after a specified period of time, do not comply with the new law.  Employers and/or legal counsel should revise existing policies to ensure compliance.
  • Prior to July 1, 2017, employers should provide notice to employees of their rights under the new law.
  • Employers should work with their payroll companies or payroll departments to develop a method for tracking and reporting employees’ paid sick time.
  • Employers should provide training to supervisors on the new law’s requirements.
  • Employers are strongly encouraged to consult with legal counsel regarding questions or concerns about complying with the new law.

Steven T. Lawrence

 

Steven T. Lawrence recently had the opportunity to discuss the current state of the M&A climate with Jordan Geotas and George Odden of CP Capital Advisory Services.

Read More Here

 

 

 

 

 

 

Steven T. Lawrence

 

Steve Lawrence Provides Insights to The Ambulatory M&A Advisor

In an article entitled “Failure in an M&A Transaction for the Physician Owner,” Milligan Lawless partner Steve Lawrence provides tips on how to avoid pitfalls during the M&A Transaction Process.

To read the full article Click Here.

 

 

 


Peer reviews have been tallied and once again, Milligan Lawless has received the following distinctions:

2017 “Best Lawyers of America”

Bryan S. Bailey – Health Care Law
James R. Taylor – Health Care Law
Robert J. Itri – Commercial Litigation; Copyright Law;
 Litigation – Intellectual Property; Trademark Law
Robert J. Milligan – Health Care Law
Steven T. Lawrence – Corporate Law

2017 “Best Law Firms”

National Tier 3
Health Care Law
Metropolitan Tier 1- Phoenix
Health Care Law
Metropolitan Tier 2-Phoenix
Commercial Litigation
Corporate Law
Employment Law – Individuals
Employment Law – Management
Labor Law – Management
Litigation – Intellectual Property
Litigation – Labor & Employment
Metropolitan Tier 3-Phoenix
Copyright Law
Trademark Law

On June 16, 2016, the U.S. Supreme Court issued a long-awaited decision addressing the

Kylie Mote

Kylie Mote

scope of liability under the False Claims Act (“FCA”).  In Universal Health Services, Inc. v. U.S. ex rel. Escobar, the Court unanimously held that the FCA may impose liability when a party falsely implies that specific services were provided in compliance with all material payment requirements.[1]  The decision is important to any healthcare provider participating in federal healthcare programs.

The FCA, generally, imposes liability upon any party who knowingly presents, or causes to be presented, false or fraudulent claims for payment to the federal government.[2]  The FCA may be enforced by the U.S. Department of Justice or by private parties (whistleblowers) who bring civil qui tam suits in “the name of the government.”[3]  Parties found liable under the FCA may be subject to treble damages and up to $10,000 per claim.[4]   

[1] Universal Health Services, Inc. v. U.S. ex rel. Escobar, 136 S.Ct. 1989 (2016)

[2] 31 U.S.C. § 3729(a)(1)(A)

[3] 31 U.S.C. § 3730

[4] 31 U.S.C. § 3729(a)

Click Here to Read the Full Article

Kylie’s Biography

We are pleased to announce today that Chambers USA ranked Milligan Lawless, P.C. and 3 of our attorneys among the best in Arizona for 2016.  Among Arizona law firms, Milligan Lawless achieved a Band 1 ranking, Chambers USA’s highest recognition, in the Healthcare practice area.

The firm received the following “Leading Individual” rankings for Phoenix attorneys:

  • Bryan S. Bailey – Healthcare
  • Steven T. Lawrence – Corporate/M&A
  • Robert J. Milligan – Healthcare

Chambers USA is an annual ranking that assesses each law firm and attorney on technical legal ability, professional conduct, client service, commercial awareness/astuteness, diligence, commitment and other qualities most valued by their clients. Additionally, independent interviews with clients and confidential submissions of law firms are part of the Chambers research and evaluation process.

 

Bryan S. Bailey

Bryan S. Bailey

Robert J. Milligan

Robert J. Milligan

Steven T. Lawrence

Steven T. Lawrence

Robert J. Itri

Robert J. Itri

 

We are pleased to announce the arrival of Attorney Robert J. Itri as our newest shareholder. Bob is an experienced attorney whose practice areas include Litigation and Intellectual Property. Bob represents clients in matters before the United States Securities and Exchange Commission, the Financial Industry Regulatory Authority (FINRA) and the Arizona Corporation Commission. He also brings a high level of experience in business matters to the firm, representing both start-up and existing businesses in complex litigation matters encompassing intellectual property and securities, arbitration and enforcement actions, contract, trade secret, business tort and shareholder litigation.

 

 

We are pleased to announce that three of the Firm’s attorneys have been recognized as 2016 Southwest Super Lawyers.  Annually, only the top five percent of attorneys in Arizona and New Mexico are selected by Southwest Super Lawyers to receive this honor.

The following Milligan Lawless attorneys are named 2016 Southwest Super Lawyers in Arizona:

  • Robert J. Itri – Business Litigation
  • Steven T. Lawrence – Business/Corporate
  • Robert J. Milligan – Health Care

Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The annual selections are made using a multiphase process that includes a statewide survey of lawyers, independent research and peer reviews by practice area.

Robert J. Itri

Robert J. Itri

Steven T. Lawrence

Steven T. Lawrence

Robert J. Milligan

Robert J. Milligan

 

 

 

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