Title I, ADA—When Is a Medical Exam a Business Necessity?


Kroll v. White Lake Ambulance Authority is a 6th Circuit case that adds to the slim body of law on when an employer’s medical examination “may be deemed job-related and consistent with business necessity” under 42 U.S.C. § 12112(d)(4)(A). Employment lawyer Paul Mollica discusses the case, which was also covered in his employment blog.

Paul Mollica

Paul Mollica

The long-running case concerns the problems of an EMT employed by the ambulance authority. In this case, the ambulance authority required Ms. Kroll to receive counseling after she was observed having angry outbursts at her workplace. The ADA generally prohibits such medical exams unless the “job-related” and “business necessity” tests are met.

The case was the subject of an initial summary judgment that went to the 6th Circuit, which sent the case back for further proceedings. On the remand, the district court again granted summary judgment, this time holding “that the proposed examination met the job-relatedness and business-necessity standards.”

On the second appeal, the 6th Circuit concluded that these findings needed to be made by a jury. The appellate court noted that there was no evidence of any kind of medical support for the decision that Ms. Kroll needed to go into counseling. Another thing the court noted was that her supervisor had not indicated that there was a business or professional reason for this, but rather that he had a concern about her personal welfare.

Mollica says that it was a mistake, in the view of the 6th Circuit, to condition her employment on receiving the counseling. The supervisor’s good intentions should not be conflated to a business reason for the counseling.

Paul W. Mollica joined Outten & Golden LLP as Of Counsel in 2010. He is a frequent author and lecturer (for lawyers and courts) in the area of employment discrimination. He is a two-term past president of the Chicago Council of Lawyers, a public-interest bar association. He has been selected as a Super Lawyer© in Illinois and has the highest, AV© rating from Martindale-Hubbell. He is licensed to practice in Illinois and New York. The Legal Broadcast Network is a featured network of the Sequence Media Group.

Reasonable Accommodation Expands Under the Rehabilitation Act


Unconventional work scheduling as a “reasonable accommodation” has been the subject of several appellate decisions in the last eighteen months. The latest one, Solomon v. Vilsack, deals with flextime scheduling. Employment lawyer Paul Mollica discusses the case in his employment law blog and in this report.

Paul Mollica

Paul Mollica

The reasonable accommodation requirement runs counter to the notion that regular attendance at work is an “essential function” that employers are entitled to expect. The Solomon case deals with a Department of Agriculture employee who suffered from depression and who had been accorded a flexible work schedule to cope with the issues of her condition and medical treatment for it. The dispute arose when new supervisors refused to extend the flextime arrangement.

The D.C. Circuit held that “the agency may have erred in refusing to fully accommodate Ms. Solomon’s need to work on a flexible schedule.” The decision noted the increasing ease of working at home. Mollica says that the decision gives employers notice that timely attendance at work is no longer something courts will automatically affirm as an essential function.

The development of the Internet and the increasing ease of telecommuting will doubtless have a growing influence on attendance at work cases. Some jobs, such as flying a plane, will always require physical presence at work. Others, like clerical and administrative functions, will not.

Paul W. Mollica joined Outten & Golden LLP as Of Counsel in 2010. He is a frequent author and lecturer (for lawyers and courts) in the area of employment discrimination. He is a two-term past president of the Chicago Council of Lawyers, a public-interest bar association. He has been selected as a Super Lawyer© in Illinois and has the highest, AV© rating from Martindale-Hubbell. He is licensed to practice in Illinois and New York. The Legal Broadcast Network is a featured network of the Sequence Media Group.

Bank of America Nets Huge Tax Deduction from Mortgage Legal Settlement


The Bank of America recently settled its liability for toxic mortgages in the amount of $17 billion. It appears that $12 billion will be tax deductible. Tax attorney Rob Wood explains the settlement in his Forbes article “BofA Grabs $12 Billion Tax Write-Off From $17 Billion Mortgage Settlement.” Wood discusses the tax situation in this report.

Rob wood

Rob wood

Wood says he is not surprised by the deductibility of a large part of the settlement. BofA did a good job in negotiating the settlement of its liability, and part of the deal, apparently, was that a large part of this huge settlement would be deductible. It seems likely, Wood opines, that the company agreed to pay the sum in exchange for getting a tax deduction.

Tax considerations probably get discussed any time a settlement like this is being considered. Businesses always need to be conscious of how expenses will be treated for taxation purposes. Wood says that usually, settlements paid to the government are deductible, even though many people believe otherwise.

If the settlement involved criminal charges, it might have changed the circumstances, but there might still have been some deductible payments, such as restitution payments, all of which are deductible. Michael Milken is the classic case. Wood says that there are proposals in Congress to make all these negotiations transparent, but no proposal has yet been passed.

For more information on the subject, please refer to Mr. Wood’s article in Forbes. Robert Wood is a tax attorney with Wood, LLP in San Francisco, California and spoke with The Tax Law Channel, an affiliate of The Legal Broadcast Network.  The Legal Broadcast Network is a featured network of the Sequence Media Group.