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Rail Strike Threat Brings New Focus on Work Attendance Policies

Oct. 7, 2022, 9:15 AM

The high-profile contract dispute between rail carriers and their employees that nearly shut down the nation’s supply chains has renewed scrutiny on workplace sick leave and attendance policies.

Roughly 125,000 US rail workers were on the verge of walking off the job last month when negotiations between their unions and rail companies soured over the long-running issues of sick leave and attendance policies.

Many rail employees are required to work 12 hours a day and are frequently on-call 24 hours a day, seven days a week. When scheduling time off, rail workers say they often have to make the requests months in advance.

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Some sick leave protections under the Family and Medical Leave Act guarantee unpaid job-protected leave for up to 12 weeks when an employee is sick, caring for a newborn or newly adopted child, or caring for an immediate family member with a serious health condition.

But the FMLA only applies when an employee has worked at least 1,250 hours over the past 12 months. Rail carriers don’t count time toward FMLA eligibility when a rail worker is on call, leaving many rail employees out, said Jared Cassity, Alternate National Legislative Director for SMART’s Transportation Division. The lack of protections made the sick leave issue a particular sticking point in the contract negotiations that came to a head last month.

“These guys are forgoing their doctor’s appointments or when they’re sick just to make sure that they have points in case an actual emergency arises,” Cassity said, “And they’re being forced to work more and more.”

Faults in ‘No Fault’

A common type of attendance policy—one being used by many of the major freight carriers in the rail dispute—is called a “no fault” points system.

Under “no fault” policies, workers will be assigned or docked points for missing work and will face some sort of disciplinary action once reaching a certain number of points, according to Robin Samuel, a partner in Baker McKenzie’s Employment and Compensation Practice Group.

Another typical attendance policy is one in which the employer reserves the right to discipline an employee for repeated violations of its policies on a progressive scale, Samuel said.

Employers may say, “One of our policies is you need to show up to work on time and ready to work and if that doesn’t happen on a regular basis, and you know, we go through this process of oral warning, written warnings, final warning, termination, or something like that,” he explained.

Complicating the decision for employers, federal leave laws like the FMLA also don’t require workers to notify their employer when the leave they are taking is job protected under the law.

“If employees have statutorily protected leave rights, then the no fault system doesn’t work,” Samuel added. “You cannot have an attendance policy that overrides a statutory right to leave.”

Considering State Laws

While workplace attendance policies are legal, companies that require them still must adhere to state and local rules, which have been evolving more since the pandemic, attorneys say.

“One area of the law certainly in California, but I think nationwide as well, where we’ve seen a consistent and rapid changing, has been sick leave laws,” said Tyler Rasmussen, a partner at Fisher Phillips’ Irvine, Calif., office. “That’s been brought on by Covid.”

Implementing “no fault” point systems can also run into issues under both federal and state requirements, attorneys caution, because employers can’t count leave taken under disability or medical leave laws against a worker.

“A lot of state and local mandatory sick leave policies and time taken as sick leave under those, would be considered protected time, and should not be administered against or counted against an attendance policy,” said Megan Winter, a partner in Fisher Phillips’ San Diego office.

Rail workers are governed under some federal laws that other common private employees aren’t, like the Railroad Unemployment Insurance Act, which provides unemployment benefits to railroad employees who can’t work because of sickness, injury, or pregnancy. Workers receive benefits if they miss work for more than four days in a row.

In both Massachusetts and California, rail carriers used that railroad unemployment law to argue that they are excluded from state paid leave requirements even before the pandemic.

The US Court of Appeals for the Ninth Circuit earlier this year sided with several rail companies, including some carriers, that the federal Railroad Unemployment Insurance Act preempted a California state law requiring that workers in the state receive a certain number of paid sick days.

And in 2018, a federal district court also ruled in favor of rail companies that argued the federal rail law overrode Massachusetts’s sick leave requirements.

But Fisher Phillips’s Rasmussen said that in the vast majority of instances for private employers—especially in California—paid leave requirements will be controlled by state law, noting that rail workers in the Ninth Circuit case are “really more of the exception than the rule.”

“Most of the time you’re gonna be bound by those kind of tending to be more strict, sick leave laws, and leave laws generally,” he said.

To contact the reporter on this story: Rebecca Rainey in Washington at rrainey@bloombergindustry.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Genevieve Douglas at gdouglas@bloomberglaw.com