Roundup of Notable Labor and Employment Law Opinions


Recent Court Opinions

By Joseph S. Murray IV
This roundup of notable labor and employment law opinions includes cases from the U.S. 4th Circuit Court of Appeals, the N.C. Supreme Court and the N.C. Court of Appeals from the past several weeks.
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Copyright 2017 North Carolina Bar Association.

Computer Fraud and Abuse Act and Employment


In a case filed in Eastern District of North Carolina alleging a claim under the federal Computer Fraud and Abuse Act (CFAA), (Sageworks, Inc. v. Creatore) the district court found that the employee accessed information belonging to the employer without authorization and exceeded his authorized access to obtain information.

Cases under CFAA can be brought in federal or state court. An employer can sue employee when the employee accesses and uses information without authorization. This law is commonly being used to file a lawsuit against an employee when the employee takes employer information and goes to work for a competitor.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.

Paid Leave as Reasonable Accommodation in NC


The EEOC has published guidance that providing paid maternity-only leave related to mother’s recovery does not violate Title VII. But does the policy raise the possibility of paid leave as a reasonable accommodation for a qualified individual with a disability?

By linking the leave to the mother’s recovery, the leave is based on a physical impairment. If paid maternity leave is linked to a disability, then employers may not be able to deny similar paid leave as a reasonable accommodation to other qualified individuals with a disability. Nothing in the ADA allows employers to favor one type of disability over another by providing better accommodation or benefits. Employer’s attorneys need to be mindful when advising clients on paid maternity leave policies.

If you have questions about North Carolina employment law, please contact Tracy Stroud at Colombo Kitchin Attorneys at 252-321-2020.

NC Choice of Law and Forum in Business Contracts


The North Carolina General Assembly has decided to legislate choice of law in commercial transactions.  It will be codified at N.C. Gen. Stat. §1G-1. The statute only applies to business contracts. The definition in the statute excludes consumer contracts and employment contracts. The statute says is when it becomes law and applies to business contracts entered into before, on, or after that date.

The benefit of this statute is that that parties they can choose North Carolina law to govern their contracts and they can select North Carolina as a forum to resolve their disputes. Before the statute was enacted an opposing party could attack choice of law in court by saying that the dispute did not have a “reasonable relation” to North Carolina or application of our law would violate a “fundamental policy” of the state whose law would apply in the absence of the choice of law provision.

Now, those attacks are not allowed under the statute. If the parties to a business contract agree that North Carolina law will govern their relationship, it may not be attached on reasonable relation or fundamental policy grounds.

The new law also allows parties to a contract to choose whether they want disputes litigated in North Carolina. Before, parties could attack forum clauses on the basis of substantial hardship or unequal bargaining power.

Finally, the new law also gives parties to business contracts the ability to select a specific North Carolina county in the contract as the place where any lawsuit relating to the contract must be filed.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.

New Seventh Circuit Court of Appeals Case Holds that Sex = Sexual Orientation


Laws governing employment discrimination based on sexual orientation are changing.

  • EEOC has consistently issued guidance that “sex” includes sexual orientation and gender identification.
  • As much as EEOC had wanted it to, until April 4, 2017, no court had held that Title VII barred sexual orientation discrimination.
  • Seventh Circuit Federal Court of Appeals (Illinois, Indiana, and Wisconsin) ruled that sex discrimination extends to sexual orientation Hively v. Ivy Tech Community College of Indiana (April 4, 2017)
  • This is the law in Illinois, Indiana, and Wisconsin and provides persuasive authority for our Federal Circuit, the Fourth Circuit.

If you have questions about employment law issues, please contact Tracy Stroud at 252-321-2020.

How Repeal of Bathroom Bill Affects Employment Law


After a controversial year on the books, North Carolina’s HB2 has been repealed.

  • Repeal of House Bill 2 and House Bill 142: Statute of Limitations for wrongful termination claims based on discrimination based on race, sex, religion, national origin, age, and disability under N.C. Gen. Stat. § 143-422.2 (NC Equal Employment Practices Act) has been restored to three (3) years.
  • Under House Bill 142 in July 2016, there was a one (1) year Statute of Limitations to file lawsuit.
  • The new law does not have any explicit recognition of employment protections based on sexual orientation or gender identity but with repeal, lawyers are again free to argue that “sex” in NC Equal Employment Practices Act refers to both sexual orientation and gender identity.
  • Existing ordinances will not go away, however all localities are pre-empted from amending or enacting employment laws until December 2020.
  • The bill passed March 30, 2017.

If you have other employment law questions, please contact Tracy Stroud at 252-321-2020.

New North Carolina Law Regarding Franchisors


Franchisors are not employers under N.C. Gen. Statute Chapters 95, 96, 97 and 105, which means franchisors cannot be held responsible for NC Wage and Hour violations, Occupational Safety and Hazard violations, Workers’ Compensation violations, and unemployment claims.

  • Only about 2,500 franchisors in the United States
  • Law will likely protect out-of-state interests and if franchisor is the decision-maker for the franchisee, there is no one to hold liable
  • The burden on compliance on Wage and Hour law, OSH workers’ compensation and unemployment will fall to small business owners, the local franchisee
  • Law signed by Governor Roy Cooper on May 4, 2017

For more information about the passage of the new law or if you have other employment law questions, please contact Tracy Stroud at 252-321-2020.

Come September, Your Form I-9 Will be Outdated


Here are changes to the I-9 form.  The new form must be used by September 18, 2017.

  1. The USCIS has changed the name of the Office of Special Counsel for Immigration-Related Unfair Employment Practices to its new name: Immigrant and Employee Rights Section.
  2. Removal of the words “the end of” from the phrase “the first day of employment.”
  3. Revisions to the list of acceptable documents:
  • The Consular Report of Birth Abroad (Form FS-240) has been added to List C. If you’re filling out the Form I-9 online, you will be able to select this form from the dropdown menus. Using e-verify? You can also select Form FS-240 when creating a case for an employee who presents this document for Form I-9.
  • All the certifications of report of birth issued by the Department of State (Form FS-545, Form DS-1350 and Form FS-240) have been combined into selection C #2 in List C.
  • All List C documents except the Social Security card have been renumbered. Example: The employment authorization document issued by the Department of Homeland Security on List C has changed from List C #8 to List C #7.

Employers can continue using the older version through Sept. 17. On Sept. 18, you must use the revised version. You’ll notice the revision date of 07/17/17 N at the bottom of the form. Storage and retention rules for any previously completed Forms I-9 remain the same.

Penalties for non-compliance:

Just last year, the Immigration and Customs Enforcement (ICE) nearly doubled fines for violations with Forms I-9. There is a $216 – $2,126 fine per Form I-9 paperwork violation. That’s an increase from $110 – $1,100. For unlawful employment of unauthorized workers, the fine for the first offense increased to $539 – $4,313 per worker from $375 – $3,200. For unfair immigration-related practices, specifically document abuse, the fine per individual increased to $110 – $1,110.

If you have any questions regarding employment issues, please contact Tracy Stroud at Colombo Kitchin Attorneys, 252-321-2020.

The Status of Workplace State Law Discrimination Claims in North Carolina


On March 23, 2016, in House Bill 2 (HB2), notoriously known as the “Bathroom Bill,” the North Carolina General Assembly set out that the North Carolina Employment Practices Act (NCEEPA) (N.C.G.S. Chapter 143) did not provide a cause of action for wrongful termination based on discrimination. The NCEEPA covers employers with 15 or more employees and provided a discrimination cause of action against employers who discriminated on the basis of race, religion, color, national origin, age, sex or handicap in employment. The statute of limitations was three (3) years in state court.

This change in North Carolina law did not affect employee rights under federal law. If employees wish to file a federal claim, the procedure is entirely different and the statute of limitations is much shorter–180 days to file a charge with the Equal Employment Opportunity Commission and then 90 days to file a lawsuit in federal court, after the EEOC concludes its investigation and issues its determination.

On July 18, 2016, the General Assembly restored the right of employees under the NCEEPA to bring wrongful discharge claims for employment discrimination in state court, but shortened the statute of limitations to one (1) year. The NCEEPA clearly does not prohibit employment discrimination against LBGT persons.

The text of the revised NCEEPA sets out: “It is the public policy of this State to protect and safeguard the right and opportunity of all persons to seek, obtain and hold employment without discrimination or abridgement on account of race, religion, color, national origin, age, biological sex or handicap by employers which regularly employ 15 or more employees.”

Employment discrimination against LBGT persons still violates federal law, and North Carolina employers must comply with both federal and state laws in terms and conditions of employment.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.



EEOC Issues Guidance on Depression, PTSD and Other Mental Health Conditions in Workplace


On December 12, 2016, the EEOC published information summarizing the rights of individuals in the workplace who suffer from depression, PTSD, and other mental health conditions. The information covers information such as discrimination and harassment, privacy and reasonable accommodations in the workplace.

The link to the publication is

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.