For most church employees, electronic communications via cell phone calls, text messaging, and e-mails have become an indispensable tool for both business and personal use. But few church leaders have a clear understanding of the legal and tax issues associated with these forms of communication. This article will explore the following issues:
- church liability for employees’ negligent driving
- criminal liability for sexually explicit messages
- employer inspection of electronic communications
- application of the clergy-penitent privilege
- the “admissions against interest” exception to the hearsay rule
- sexual harassment
- the tax implications of cell phone use
- Issue #1: Church Liability for Employees’ Distracted Driving
- There is no doubt that cell phones are a tremendous convenience, and make pastors and other church staff members accessible in the event of emergencies. But the use of such devices while operating a vehicle can cause the driver to be distracted, especially when they are used for texting, web surfing, or checking e-mail. And, distracted driving can lead to accidents and astronomical monetary damages. Some employers have paid out millions of dollars to settle lawsuits resulting from accidents caused by employees who were distracted while driving as a result of the use of a cell phone.
- Consider the following statistics compiled by the U.S. Department of Education:
- 20 percent of injury crashes in 2009 involved reports of distracted driving.
- Of those killed in distracteddriving-related crashes, 995 involved reports of a cell phone as a distraction (18 percent of fatalities in distraction-related crashes).
- In 2009, 5,474 people were killed and an estimated additional 448,000 were injured in motor vehicle crashes on U.S. roadways that were reported to have involved distracted driving.
- Drivers who use hand-held devices are four times as likely to get into crashes serious enough to injure themselves.
- Using a cell phone while driving, whether it’s hand-held or handsfree, delays a driver’s reactions as much as having a blood alcohol concentration at the legal limit of .08 percent.
- The proportion of fatalities reportedly associated with driver distraction increased from 10 percent in 2005 to 16 percent in 2009. During that time, fatal crashes with reported driver distraction also increased from 10 percent to 16 percent.
- The portion of drivers reportedly distracted at the time of the fatal crashes increased from 7 percent in 2005 to 11 percent in 2009.
- The under-20 age group had the highest proportion of distracted drivers involved in fatal crashes (16 percent). The age group with the next greatest proportion of distracted drivers was the 20- to-29-year-old age group; 13 percent of all 20-to-29-yearold drivers in fatal crashes were reported to have been distracted.
- Of those drivers reportedly distracted during a fatal crash, the 30-to-39-year-old drivers were the group with the greatest proportion distracted by cell phones. Cell phone distraction was reported for 24 percent of the 30-to-39-year-old distracted drivers in fatal crashes.
- An estimated 20 percent of 1.52 million injury crashes were reported to have involved distracted driving in 2009.
- Unfortunately, few church leaders have considered the potential risk … for deaths and injuries caused by church employees operating a vehicle on church business while using a cell phone.
- It is easy to prove that a driver was operating a cell phone at the time of an accident by comparing cell phone records with a car’s “event data recorder.” An EDR is similar in concept to a commercial jet’s “black box.” It records a number of facts about vehicle operation, speed, accidents, and airbag deployment. According to the National Highway Traffic Safety Administration, 85 percent of all vehicles are now equipped with EDRs. Prosecuting attorneys use EDR and cell phone records in court to prove that a driver was distracted at the time of an accident.
• Example. Lynn is a church employee. While driving her car on a churchrelated errand, she becomes distracted while speaking with her daughter on her cell phone, swerves across the center line, and causes a head-on collision with another vehicle. According to the NHTSA, it is “a near certainty that one or more of the vehicles in a collision involving two private passenger autos or light vehicles will have an operational EDR.” The EDR will establish the time of the accident, and Lynn’s cell phone records will prove that she was using her cell phone at the time of the accident. This is strong evidence of negligence that may be imputed to the church under the respondeat superior doctrine (see below).
- Unfortunately, few church leaders have considered the potential risk to their church for deaths and injuries caused by church employees operating a vehicle on church business while using a cell phone for calls or text messaging. In particular, note the following four risks:
- (1) respondeat superior
- An employer is responsible for the injuries caused by its employees if (1) an employer-employee relationship existed at the time of the injury, (2) the injury was caused by an employee’s negligence, and (3) the employee was acting in the course of his or her employment at the time of the injury. Courts refer to this as the respondeat superior doctrine (i.e., the “employer responds” for the damages its employees cause).
• Key point. A church employee whose negligence or misconduct results in injury to another person is not insulated from personal liability by the respondeat superior doctrine. Church employees whose conduct injures other persons in the course of their church duties can be sued directly by injured victims. Often, both the employee and the church are sued.
- The negligence of church employees who cause accidents in the course of texting, web surfing, or checking e-mail while driving a vehicle in the course of their employment may be imputed to their employing church on the basis of the respondeat superior doctrine if the three conditions summarized above are met.
• Example. An employee of a construction company caused an accident when a vehicle he was driving struck another vehicle at an intersection. The employee insisted that he was not using his cell phone at the time of the accident, but records provided by his cell phone company revealed that he was using his cell phone. A person injured in the other vehicle (the plaintiff) sued the construction company, claiming that it was responsible for the negligent and distracted driving of its employee while he was operating his vehicle in the course of his employment. A trial court dismissed the lawsuit, but a state appeals court reversed and remanded the case back to the trial court. The court noted that employers are legally responsible on the basis of the “respondeat superior” principle for injuries caused by the negligent acts of their employees committed within the course of their employment. It acknowledged that employees who are in the process of traveling to or from work generally are not within the scope of their employment, and therefore their negligent acts cannot be imputed to their employer. However, it concluded that a commute to work can be within the scope of employment if an employee is using a cell phone at the time for work-related business. The court noted that the employee in this case “may have been on his cell phone regarding company business when the accident occurred or that he might have been distracted by an incoming call from [a co-employee] whom he knew was calling to tell him that he would be late or that he needed something for his work when he arrived.” Hunter v. Modern Continental Construction Company, 652 S.E.2d 583 (Ga. App. 2007).
• Example. A church was sued for injuries and damages caused by the reckless driving of its pastor. The injured victim alleged that the pastor was an employee of his church, and thus the employer-church was vicariously liable for the consequences of the pastor’s negligence committed in the course of employment. The church denied liability on the ground that its pastor was self-employed and not an employee, and accordingly his negligence could not be imputed to the church. The California Supreme Court concluded that the pastor was an employee of his church and that his negligence was imputable to the church. Vind v. Asamblea Apostolica De La Feen Christo Jesus, 307 P.2d 85 (Cal. 1957).
• Example. A Louisiana appeals court ruled that a church was responsible for injuries sustained in an automobile accident caused by the negligent driving of a deacon while on church business. Whetstone v. Dixon, 616 So.2d 764 (La. App. 1993).
- The doctrine of respondeat superior imputes an employee’s negligence to his or her employer only if the negligence occurred in the course of employment. It often is difficult to ascertain whether employees are acting in the course of their employment at the time of a negligent act. Generally, conduct of an employee is in the course of employment if
- it is of the kind the employee is employed to perform
- it occurs during the hours and within the geographical area authorized by the employment relationship, and
- it is motivated, at least in part, by a desire to serve the employer.
- before or after working hours
- while commuting to or from work
- an unreasonable distance from an authorized work area, or
- while the employee is engaged in personal business.
- the purpose of the statute is the protection of the interest of the victim as opposed to the public;
- the statute must clearly apply to the conduct of the wrongdoer;
- the wrongdoer must violate the statute; and
- the violation of the statute must cause the victim’s injury.
- pre-collision vehicle speed
- engine throttle percentage and braking activity at half-second intervals for five seconds prior to collision
- driver seat belt usage
- engine cycle count at the time of collision
- number of collision events
- time of collisions
- airbag deployment information
- the volunteer was acting within the scope of the volunteer’s responsibilities in the nonprofit organization or governmental entity at the time of the act or omission;
- the harm was not caused by willful or criminal misconduct, gross negligence, reckless misconduct, or a conscious, flagrant indifference to the rights or safety of the individual harmed by the volunteer; and
- the harm was not caused by the volunteer operating a motor vehicle, vessel, aircraft, or other vehicle for which the state requires the operator or the owner of the vehicle, craft, or vessel to possess an operator’s license or obtain insurance.
- Make any changes you deem necessary. The policy is simply an example.
- Do not implement any policy if you are not assured that it can be consistently implemented. While a church is exposed to legal risk by not adopting a policy banning cell phone use by persons who are driving vehicles on church business, the risk is even greater if a church adopts a policy banning such use and a person is injured or killed because of a violation of the policy by a church staff member.
- The policy only addresses legal risks associated with the use of cell phones by church staff members while driving a vehicle on church business. Some churches may want to expand the policy, or adopt a second policy, to address the tax issues associated with the use of cell phones by church staff.
- Be sure to check out local and state laws to determine what, if any, legal restrictions apply to the use of cell phones. Be sure your policy complies with such restrictions.
- This policy bans the use of both handheld and “hands free” cell phones by drivers. This is the “best practice,” since it will result in the greatest reduction in the risk of death and injury. Some churches may prefer to ban only the use of handheld cell phones. This will require a modification of the policy. However, note that such a modification will increase a church’s risk of liability. As noted above, it is difficult to imagine an emergency so great that a driver must use a cell phone (whether handheld or hands-free) while driving. Some studies have concluded that the risk of inattention and accident by drivers using cell phones is the same whether they use a “handsfree” feature or not.
- Before adopting any cell phone usage policy, be sure to have it reviewed by an attorney.
- Definitions. As used in this policy, the following terms are defined as follows: “Course of Church business” means (1) in the course of employment, in the case of an employee; and (2) while engaged in any Church program or activity, in the case of a volunteer.
“Drive” means to operate a vehicle with the engine operating, whether the vehicle is stopped or moving.
“Employee” means any compensated employee of the Church.
“Use” means to place or receive a call on a cell phone, or in any other manner operate a cell phone for the purpose of communicating with another person or persons, whether in a handheld or “handsfree” mode.
“Vehicle” means any motorized vehicle, whether or not owned by the Church.
“Volunteer” means a member of the Church, or a nonmember who regularly attends the Church.
- Drivers of minors. No Church employee or volunteer may use a cell phone while driving a vehicle in the course of Church business in which one or more minors are passengers.
- Drivers of adults. No Church employee or volunteer may use a cell phone while driving a vehicle in the course of Church business in which one or more adults are passengers.
- Driving alone. No Church employee or volunteer may use a cell phone while driving a vehicle without passengers in the course of Church business.
- Permitted cell phone use. Church employees and volunteers may use a cell phone in any one or more of the following circumstances: (1) while driving a vehicle in the course of Church business in the event of an emergency in which the use of a cell phone is necessary to prevent injury or death to one or more persons, if no adult passenger is available to make the call; (2) while driving a vehicle in the course of Church business if necessary to report the commission of suspected criminal activity, if no adult passenger is available to make the call; (3) in a vehicle that is stopped in a safe location, with the engine off; or (4) while riding in a vehicle as a passenger.
- the city had a legitimate workrelated reason for the search, and
- the search was not excessively intrusive in light of that justification.
- The federal Electronic Communications Privacy Act (also known as the WiretapAct) prohibits the intentional interception of telephone calls without consent. But,under the so-called “business extension exemption,” an employer may listen in onan employee’s telephone calls on an “extension telephone” so long as this is donein the ordinary course of business. This will be harder to prove if employees arepermitted to use church telephones for personal calls (even if doing so violates awritten policy).
- When a church employee picks up a telephone and hears another conversationin progress, he or she must immediately determine if the conversationis business or personal. If it is personal in nature, then the employee shouldhang up the telephone. Continuing to listen in on a personal telephone callmay subject the employee, and the church, to criminal and civil liability.
- A church does not violate the Wiretap Act when it intercepts employees’ telephoneconversations if the employees have consented to the interceptions. Itis possible to obtain employees’ consent through appropriate policies that areexplained to, and acknowledged by, the employees.
- The Electronic Communications Storage Act is violated when an employer accesseswithout consent an employee’s e-mail account directly on the “electroniccommunication service provider” (such as Hotmail) and in addition “obtains,alters, or prevents authorized access” to an electronic communication “while itis in electronic storage in such system.” While a church may not violate the Actwhen it accesses an employee’s e-mail after it has been downloaded to the employee’scomputer hard drive, it may invade the employee’s privacy by doing so.
- Several states have their own electronic privacy laws that may apply to theinterception of telephone calls and inspection of e-mail on church computers.These laws should be consulted.
- Even if state or federal electronic privacy laws are not violated by an interceptionof a church employee’s telephone call, or inspection of the employee’s emailor computer, such acts could amount to an invasion of privacy for whichthe church may be liable.
- An education campaign to employers, launched during Drive Safely Work Week, calling on employers to prevent occupationally related distracted driving—with a special focus on prohibiting texting while driving;
- A website which carries a video message and an open letter to employers from Assistant Secretary [David] Michaels …. We will showcase model employer policies and team up with employer and labor associations to communicate our message;
- We will forge alliances with the National Safety Council and other key organizations to help us reach out to employers, especially small employers, to combat distracted driving and prohibit texting while driving;
- We will place a special emphasis on reaching young workers—working with other Labor Department agencies, as well as our alliance partners and stakeholders; and
- When OSHA receives a credible complaint that an employer requires texting while driving or who organizes work so that texting is a practical necessity, we will investigate and where necessary issue citations and penalties to end this practice.
- churches with respect to clergymen while performing or participating in religious services
- churches with respect to other participants in religious services, such as choir masters, organists, other musicians, choir members, ushers, and the like
- Stress to employees the importance of safeguarding churchowned smartphones and tablets, and the problems that may be associated with lost or stolen devices. All church-owned devices should be safeguarded when not in use to protect against unauthorized access.
- Use strong passwords to protect data. Consider devices or software that automatically erase all data after a specified number of unsuccessful attempts to enter a password.
- Use apps that have the ability to remotely and automatically erase all data on a smartphone or tablet if it is lost or stolen.
- Advise employees not to access untrusted networks using wi-fi in public places, since there is the possibility that information is being captured.
- Require employees who use their personal smartphones or tablets to access the church’s network to have reliable malware filters on their devices that will minimize the risk of the church’s network being attacked due to malware on an employee’s device.
- Adopt a policy addressing how church data will be retrieved from employees’ personal devices upon termination.
- Adopt a policy that clearly authorizes the church to access smartphones and tablets that it provides to employees. Some employers expand such a policy to include employees’ personally owned devices if they are used to store church data or access a church network.
An employer generally will not be responsible for the misconduct of an employee that occurs:
In each of these situations, the courts generally have ruled that an employee is not in the course of his or her employment. However, some courts have ruled that using a cell phone for employmentrelated work in any of these contexts may satisfy the “course of employment” requirement.
• Example. A church employee is driving her car on church business. She becomes distracted while texting her teenage daughter and kills a pedestrian. The pedestrian’s surviving spouse sues the employee and the church. Since the employee’s negligence occurred in the course of her employment, the church can be liable for her negligence on the basis of respondeat superior.
• Example. Same facts as the previous example except that the accident occurred on a weekend (a non-work day). Since the accident did not occur in the course of employment, the church cannot be liable on the basis of respondeat superior.
(2) negligence per se
Under the doctrine of “negligence per se” a person is presumed to have been negligent if he or she causes an accident while engaged in behavior that violates a statute or ordinance. An accident victim may sue the wrongdoer for money damages if:
It is important for church leaders to be familiar with the concept of negligence per se. The key point is this: Church employees who cause deaths or injuries while engaged in conduct that violates a statute or ordinance will be presumed to have been negligent, meaning that the only remaining question is the amount of damages to be assessed. And, under the doctrine of respondeat superior, the employee’s negligence will be imputed to the church if it occurred in the course of employment.
Negligence per se is directly relevant to the topic of cell phones since an increasing number of jurisdictions have prohibited or restricted various modes of electronic communication while operating a vehicle. Church employees who cause an accident while driving a vehicle in violation of such laws are exposing themselves and their church to automatic legal liability, with the only remaining question for the courts to determine being the amount of monetary damages the church will be assessed. As a result, it is essential for church leaders to be familiar with all applicable laws and ordinances that restrict the use of cell phones while driving, and ensure that church employees are apprised of these laws and are instructed to comply with them.
Several states have enacted laws regulating the use of cell phones while driving. According to the National Highway Traffic Safety Administration (NHTSA), 30 states and the District of Columbia ban text messaging for all drivers. Twelve of these laws were enacted in 2010 alone. Eight states and the District of Columbia prohibit all drivers from using handheld cell phones while driving.
• Example. Jan is a church employee. While driving her car on church business she caused an accident, resulting in serious injuries to the driver of the other vehicle. The evidence reveals that she was texting her teenage daughter at the time of the accident. She lives in one of the 30 states that ban text messaging by all drivers. This example illustrates negligence per se. That is, Jan is presumed to have been negligent since she caused an accident while engaged in behavior that violated state law. And, since she was engaged in the course of her employment at the time of the accident, her negligence is imputed to the church. The only question for the jury will be the amount of damages. Neither Jan nor the church will be allowed to introduce evidence rebutting the presumption of negligence.
• Example. A youth pastor asks a 16-year-old member of the youth group to drive seven other members in her parents’ SUV to a function at a member’s home. En route, the driver dropped her cell phone. While fumbling around to retrieve it she swerved across the center line and slammed into a truck, causing multiple injuries, some of which are severe. State law bans 16-year-old persons from driving with one or more other teenagers in the car without the presence of at least one adult. Since the driver was driving in violation of this law at the time of the accident, she will be presumed negligent under the negligence per se doctrine. And, since she was engaged in “church business” at the time of the accident, it is possible that her negligence will be imputed to the church. The only question for the jury will be the amount of damages. Neither the driver nor the church will be allowed to introduce evidence rebutting the presumption of negligence.
There are federal and state restrictions on the use of cell phones while driving. To illustrate, President Obama signed an executive order in 2009 banning all text messaging by all federal employees and federal contractors. The order reads, in part:
With nearly 3 million civilian employees, the federal government can and should demonstrate leadership in reducing the dangers of text messaging while driving. Recent deadly crashes involving drivers distracted by text messaging while behind the wheel highlight a growing danger on our roads. Text messaging causes drivers to take their eyes off the road and at least one hand off the steering wheel, endangering both themselves and others. Every day, federal employees drive government-owned, government-leased, or governmentrented vehicles or privately-owned vehicles on official government business, and some federal employees use government-supplied electronic devices to text or e-mail while driving. A federal government-wide prohibition on the use of text messaging while driving on official business or while using government-supplied equipment will help save lives, reduce injuries, and set an example for state and local governments, private employers, and individual drivers.
In addition, Congress has conducted hearings on the need for federal legislation limiting the use of cell phones while driving, but no legislation has been enacted.
NHTSA’s Final Ruling on EDRs
In 2006 the National Highway Traffic Safety Administration (NHTSA) issued a 207-page regulation for automotive “event data recorders” (EDRs). The regulation requires that, beginning in September 2012, all EDRs installed in “light vehicles” (those with unloaded weights of 5,500 pounds or less) must record a minimum set of data.
Note that the regulation does not require that light vehicles have an EDR installed. Rather, it prescribes the minimum amount of data that must be recorded by vehicles that have such a device. The NHTSA has stated that it chose not to mandate the installation of EDRs based on evidence that 85 percent of all vehicles already are equipped with such devices.
However, NHTSA cautioned that it is prepared to make EDRs mandatory “if current trends in the growth of voluntary EDR installation are reversed or slowed.” The NHTSA has stated that “by 2010 it will be a near certainty that one or more of the vehicles in a collision involving two private passenger autos or light vehicles will have an operational EDR.”
The minimum data required by EDRs include 15 categories. Some of the more significant data items include:
In addition, the NHTSA regulation lists 30 other kinds of data that, if recorded, must meet strict guidelines. These include right front-passenger seat belt usage, engine rpm, steering angle, and roll angle.
(3) punitive damages
Punitive damages are monetary damages that a jury can award when a defendant’s conduct is reprehensible and outrageous. This does not necessarily mean intentional misconduct. Punitive damages often are associated with reckless conduct or conduct creating a high risk of harm. The United States Supreme Court has noted that the goal of punitive damages is “deterrence and retribution,” that is, “to further a state’s legitimate interests in punishing unlawful conduct and deterring its repetition.” State Farm Mutual Automobile Insurance Company v. Campbell, 538 U.S. 408 (2003).
It is important for church leaders to understand that reckless inattention to risks can lead to punitive damages, and that such damages ordinarily are not covered by a church’s liability insurance policy. This means that a jury award of punitive damages represents a potentially uninsured risk. As a result, church leaders should understand the basis for punitive damages, and avoid behavior which might be viewed as grossly negligent.
A church may be vulnerable to a punitive damages award in two ways. First, it fails to implement, monitor, and enforce a reasonable cell phone policy for persons driving vehicles on church business; or (2) it is vicariously liable under the doctrine of respondeat superior (addressed above) for injuries caused by the reckless behavior of an employee or volunteer using a cell phone while driving on church business. Several courts have ruled that punitive damages can be awarded against an employer for the reckless behavior of an employee or agent. However, some conditions apply. To illustrate, section 217C of the Restatement (Second) of Agency, a respected legal treatise that has been adopted by many courts, states that punitive damages can be awarded against a principal for the act of an agent if: (1) the principal authorized the doing and the manner of the act, or (b) the agent was unfit and the principal was reckless in employing him, or (c) the agent was employed in a managerial capacity and was acting in the scope of his employment, or (d) the principal or a managerial agent of the principal ratified or approved the act.
(4) board liability
Most states have enacted laws limiting the liability of church officers and directors. In some states, these laws protect all church volunteers. Some laws only protect officers and directors of churches that are incorporated under the state’s general nonprofit corporation law. The most common type of statute immunizes uncompensated directors and officers from legal liability for their ordinary negligence committed within the scope of their official duties. These statutes generally provide no protection for “willful and wanton” conduct or “gross negligence.”
In 1997 Congress enacted the Volunteer Protection Act. The Act clarifies that it “preempts the laws of any state to the extent that such laws are inconsistent with this [Act] except that this [Act] shall not preempt any state law that provides additional protection from liability relating to volunteers or to any category of volunteers in the performance of services for a nonprofit organization or governmental entity.” The Act specifies that no volunteer of a nonprofit organization is liable for harm caused by any act or omission on behalf of the organization if:
In summary, the limited immunity from personal liability that is available to uncompensated church board members under both state law and the federal Volunteer Protection Act may not protect them from being sued personally by persons who are injured as a result of the reckless driving of a church employee or agent whose use of a cell phone caused the accident. Board members may be personally liable in such cases if their failure to implement, monitor, and enforce a reasonable cell phone policy for persons driving vehicles on church business amounts to “willful or wanton” behavior, recklessness, or gross negligence.
a cell phone policy
On page 7 are two documents: (1) a cell phone policy, and (2) a written acceptance of the policy (to be signed by any employee or volunteer who operates a vehicle in the course of church business). Note the following important points about the policy.
Cell Phone Policy
In order to protect the public from hazards associated with the use of cell phones by church employees and volunteers while driving vehicles on church business, First Church, of [city and state] (hereinafter “Church”) has adopted the following policy:
Any Church employee or volunteer who drives a vehicle (whether or not owned by the Church) in the course of Church business shall comply with the following policy, and indicate his or her acceptance of this policy by a signed acknowledgment.
Acceptance of Cell Phone Policy
I [Name Of Employee Or Volunteer], acknowledge that I have read and understand the Cell Phone Policy of First Church (the “Policy”), and in consideration of my being permitted to operate a vehicle in the course of Church business, and for other valuable consideration the receipt of which is acknowledged, agree unconditionally to comply with the Policy whenever I am driving a vehicle in the course of Church business.
Issue #2: Criminal Liability for Sexually Explicit Messages
In many states the transmission of sexually explicit text messages (“sexting”) via a cell phone or other electronic device constitutes a crime. Such messages also can be used as evidence in civil lawsuits. For example, assume that an adolescent female in a church youth group claims that the youth pastor had nonconsensual sexual contact with her. She sues the church, claiming that it is responsible for the pastor’s acts on the basis of negligent hiring and supervision. The victim subpoenas the youth pastor’s text messages to establish the truth of her claims.
Several courts have addressed the issue of criminal liability of pastors for engaging in sexting. Consider the following examples:
• Example. A pastor was convicted of several sexual offenses involving his sexual solicitation and molestation of a minor, and sentenced to a minimum prison term of 186 years. One of his offenses was “contributing to delinquency of a minor,” which was based in part on several sexually explicit text messages (“sexting”) that the pastor sent to the minor on his cell phone. 2010 WL 10409 (N.C. App. 2010).
• Example. A youth pastor (the “defendant”) was sentenced to five years in a state prison as a result of various sexual offenses with a minor female (the “victim”). The victim had sought out the defendant for counseling as a result of her depression and suicidal thoughts that stemmed from an incident of sexual abuse which occurred when she was nine or ten years old. A sheriff came upon the defendant and victim parked off a gravel road in a rural area at night. The defendant claimed he was parked in a remote area because he was trying to get a signal on his cell phone. The sheriff told him “it wasn’t smart to be out on a gravel road parked like that with a youth in his vehicle,” and he told him to “use his head.”
The sheriff later informed the victim’s father about what he had seen, and the father instructed the defendant to have no further contact with his daughter by cell phone or text message. A few weeks later the sheriff again came across the defendant and victim in a car parked along a secluded farm road. The defendant claimed that he was counseling the victim regarding an incident of sexual abuse that had occurred several years earlier. The sheriff again informed the victim’s parents.
The defendant was later charged with several sex offenses. An investigation by the sheriff’s office uncovered text messages between him and the victim containing strong sexual content. His cell phone contained a partially nude image of the victim, and he sent a partially nude image of himself to the victim via a text message. This evidence was used in prosecuting the defendant for violating a state law making it a criminal offense for the sexual exploitation of a counselee by a counselor. The court found that the defendant, as a youth counselor engaged in counseling the victim, was a “counselor” and it sentenced him to a prison term of five years. State v. Duvall, 776 N.W.2d 301 (Iowa App. 2009).
• Example. A court used sexually explicit text messages between a youth pastor and a female member of the youth group to corroborate her account of sexual exploitation. The court sentenced the pastor to a prison sentence of four years to life. 2009 WL 1476934 (Colo. App. 2009).
• Example. A youth pastor (the “defendant”) sent several sexually explicit e-mails to a female adolescent in the church’s youth group. The victim told her mother about the e-mails. After reviewing the messages, the mother contacted the police. A police officer questioned the defendant about the e-mails. The defendant admitted that he sent the e-mails, and expressed deep remorse for his actions. In the transcript of this conversation the defendant stated that he had made “a very, very poor decision to engage in these e-mail conversations with her, uh, and allowed myself to get caught up in things of a sexual nature.” The state charged the defendant with six counts of communicating with a minor for immoral purposes under a state law making it a class C felony for a person to communicate with a minor for immoral purposes through electronic communication. At trial, the defendant testified that he did not remember sending any of the e-mails. The jury didn’t believe him, and found him guilty on all six counts. The trial court sentenced the defendant as a class C felon to the statutory maximum of five years per count. State v. Haack, 2010 WL 4216705 (Wash. App. 2010).
• Example. A volunteer youth leader (the “defendant”) in a local church was sentenced to eight years in prison on each of two counts of sexual assault in the first degree and contributing to the delinquency of a minor. At trial, the defendant’s former husband testified that he suspected his wife of having an affair. He set up surveillance in his house then left for the weekend. When he returned and retrieved the hidden device, he watched the videotaped recording of his wife and a 17-year-old male consuming alcohol and having sexual relations. He gave the police this recording, which led to the defendant’s arrest and prosecution. Among the several items of evidence introduced at trial by the prosecution were several sexually explicit text messages from the defendant that the mother of one of the victims found on her son’s cell phone. Cluck v. State, 2009 WL 1362863 (Ark. App. 2009).
Issue #3: Employer Inspection of Electronic Devices and Communications
Many churches provide cell phones and computers to employees. If the church retains ownership in such equipment, does it have the legal authority to inspect their contents without an employee’s knowledge or consent? This is an important question, since church leaders may inadvertently violate state or federal laws if they are not familiar with some basic principles, including the following:
1. Workplace privacy. In a significant 2010 decision the United States Supreme Court concluded that the search of the plaintiff’s pager messages by the city was reasonable, and therefore did not violate the Fourth Amendment guaranty against unreasonable searches and seizures. City of Ontario v. Quon, 2010 WL 2400087 (U.S. 2010). It applied a two-prong test in evaluating the reasonableness of the city’s actions:
Since the Fourth Amendment is a limitation upon government action, it has no direct application to churches and other religious organizations. However, the Supreme Court made clear that the “reasonable expectation of privacy” that is at the heart of the Fourth Amendment applies equally to the private employment context. It observed:
Because the search was motivated by a legitimate work-related purpose, and because it was not excessive in scope, the search was reasonable …. For these same reasons—that the employer had a legitimate reason for the search, and that the search was not excessively intrusive in light of that justification—the Court also concludes that the search would be regarded as reasonable and normal in the private-employer context ….
The Quon case provides church leaders with valuable guidance on the propriety of inspections of church-provided pagers, cell phones, and computers that are used by employees. According to the Supreme Court, such inspections may be legally justifiable if based on a “legitimate work-related purpose” and the search is not “excessively intrusive in light of that justification.”
• Key point. Some church employees own a laptop computer that they use, either occasionally or regularly, in their church office. The expectation of privacy is even higher for such computers, since they are owned by the employees.
“Over the past decade, there has been a technological revolution in the workplace as employers have increasingly turned to computer technology as the primary tool to communicate, conduct research, and store information. As the use of computer technology has increased, so has concern grown among employers that their computer resources may be abused by employees—either by accessing offensive material or jeopardizing the security of confidential information—and may provide an easy entry point into a company’s electronic systems by computer trespassers. As a result, companies have developed computer policies and implemented strategies to monitor their employees’ use of email, the Internet, and computer files. National surveys have reported that many companies are engaged in such practices. Federal and state laws and judicial decisions have generally given private sector companies wide discretion in their monitoring and review of employee computer transmissions, including the Internet and e-mail. However, some legal experts believe that these laws should be more protective of employee privacy by limiting what aspects of employee computer use employers may monitor and how they may do so.” [From a Report by the General Accounting Office to the Ranking Minority Member, Subcommittee on 21st Century Competitiveness, Committee on Education and the Workforce, House of Representatives, September 2002.]
Table 1: Key Elements of a Computer-Use Policy
|Monitoring use of proprietary assets
|Statements that company computing systems are provided as tools for business and all information created, accessed, or stored using these systems are the property of the company and subject to monitoring, auditing, or review.
|Establishing no expectation of privacy
|Statements about the extent or limitations of privacy protections for employee use of e-mail, the Internet, and computer files.
|Improper employee use
|Statements that some uses of company computers are inappropriate—including specific notice banning offensive material (e.g., obscenity, sexual content, racial slurs, derogation of people’s personal characteristics), and language relating e-mail and Internet use to general prohibitions of harassment.
|Allowable employee uses
|Statements explaining proper or acceptable uses of the company systems, including whether or not personal use is permitted.
|Protecting sensitive company information
|Statements providing instructions for handling proprietary information on company systems.
|Statements that there are penalties and disciplinary actions for violations of company usage policy.
|Employee acknowledgement of policy
|A statement requiring that employees demonstrate they understand the company policy and acknowledge their responsibility to adhere to the policy.
Source: U.S. General Accounting Office’s analysis of recommended computer-use policies.
The Supreme Court noted in the Quon case that the city’s computer policy was evidence that its inspection of pager messages was “not excessively intrusive.” This is an important reason for churches to adopt a computer policy. This policy should inform employees that computers, pagers, and cell phones provided by the church are subject to inspection. It also should clarify that employees have no expectation of privacy with respect to the content of such devices. The Supreme Court did not say that the mere existence of such a policy will be conclusive evidence that an employer’s inspection of such devices will be reasonable. The contents of the policy, and the circumstances of each case, must be considered. But, churches will be in a better legal position with such a policy than without one.
The U.S. General Accounting Office has prepared a table (Table 1) identifying the key elements of a computer-use policy. While the table leaves out some important elements, it nonetheless is a valuable resource from a reputable source.
Accessing Employees’ Telephone Calls and Computers
The Quon case suggests that church employees should refrain from intercepting orrecording employees’ telephone calls or inspecting employees’ private e-mail unlessthey are familiar with the following rules:
2. Other cases. Several other courts have addressed workplace privacy in the context of nongovernmental employers. Some of the leading cases involving churches are summarized below:
Case study. A federal court in North Carolina dismissed a lawsuit brought by a pastor against his former church in which he claimed that the church had violated his rights under federal electronic privacy laws by searching his laptop computer for pornography. Formal allegations of misconduct were brought against the pastor during his tenure. These allegations included using his laptop computer in his church office to view pornography, and sexual relations with a female church member. The pastor denied any wrongdoing. Upon hearing of the allegations, members of the church’s investigation committee entered the pastor’s office and attempted to access information on his laptop computer. The pastor later resigned as a result of the allegations, and received a severance package. He then sued the church on the basis of several alleged wrongs, including a violation of the federal Electronic Privacy Act as a result of the church’s inspection of his church-provided computer. The court dismissed the lawsuit on the ground that it was barred by the First Amendment guaranty of religious freedom from resolving what it considered to be a dispute involving the qualifications of a minister. Jacobs v. Mallard Creek Presbyterian Church, 214 F.Supp.2d 552 (W.D.N.C. 2002).
Case study. In one of the few cases to address the liability of a church for the seizure and inspection of a staff member’s computer, a federal court in Wisconsin ruled that a church and its senior pastor, secretary, and business administrator could be sued by a former youth pastor who was dismissed as a result of pornographic materials that were discovered on his office computer. The court ruled that the church’s actions may have violated the federal Electronic Communications Privacy Act, also known as the Wiretap Act, the Electronic Communication Storage Act, and in addition amounted to an invasion of privacy. Fischer v. Mt. Olive Lutheran Church, Inc., 207 F.Supp.2d 914 (W.D. Wis. 2002).
• Key point. Note that prior cases must be interpreted and applied in light of the Supreme Court’s 2010 ruling in the Quon case.
3. Federal and state legislation pertaining to workplace privacy. Congress and several state legislatures have enacted legislation that may expose employers to liability for nonconsensual searches of employer-provided computers.
Electronic Communications Privacy Act
The federal Electronic Communications Privacy Act, also known as the Wiretap Act, prohibits the intentional interception of “wire, oral or electronic communications.” The Act defines an “interception” as “the acquisition of the contents of any wire, electronic, or oral communication through the use of any electronic, mechanical, or other device.”
The federal Wiretap Act provides that “consent” is a defense to criminal liability:
It shall not be unlawful under this chapter for a person not acting under color of law to intercept a wire, oral, or electronic communication where such person is a party to the communication or where one of the parties to the communication has given prior consent to such interception unless such communication is intercepted for the purpose of committing any criminal or tortious act in violation of the Constitution or laws of the United States or of any State. 18 USCA 2511(2)(d).
The Act specifies that those who violate the Act “shall be fined under this title or imprisoned not more than five years, or both.” The Act also specifies that persons whose telephone or other electronic communications are intercepted in violation of the Act may sue the perpetrator for money damages. Private lawsuits must be filed within two years “after the date upon which the claimant first has a reasonable opportunity to discover the violation.”
Electronic Communications Storage Act
The Electronic Communications Storage Act, also known as the Stored Communications Act, was added to the Wiretap Act in 1986. The Act specifies that “whoever (1) intentionally accesses without authorization a facility through which an electronic communication service is provided; or (2) intentionally exceeds an authorization to access that facility; and thereby obtains, alters, or prevents authorized access to a wire or electronic communication while it is in electronic storage in such system” violates the Act. “Electronic storage” is defined as “(A) any temporary, intermediate storage of a wire or electronic communication incidental to the electronic transmission thereof; and (B) any storage of such communication by an electronic communication service for purposes of backup protection of such communication.”
Very few courts have applied the Electronic Communications Storage Act to an employer’s access to an employee’s e-mail account. From the limited precedent, it would appear that an employer does not violate the Act by accessing e-mail on a computer after they have been downloaded by an employee to his or her hard drive. The Act is violated when an employer accesses without consent an employee’s e-mail account directly on the “electronic communication service provider” (such as Hotmail) and in addition “obtains, alters, or prevents authorized access” to an electronic communication “while it is in electronic storage in such system.” While a church may not violate the Act when it accesses an employee’s e-mail after it has been downloaded to the employee’s computer hard drive, it may invade the employee’s privacy by doing so (as noted above).
• Key point. Church leaders should not access church-owned computers or cell phones without first consulting with a local attorney.
Computer Fraud and Abuse Act
Under the federal Computer Fraud and Abuse Act, anyone who “intentionally accesses a computer without authorization … and thereby obtains … information from any protected computer if the conduct involved an interstate or foreign communication” may have violated the Act. However, in order to maintain a civil action under the Act, an employee must have suffered “damage or loss” by reason of a violation. “Damage” is defined as “any impairment to the integrity or availability of data, a program, a system, or information that … causes loss aggregating at least $5,000 in value during any 1-year period to one or more individuals.” Damages are limited to economic damages. The Act does not define a “loss,” but the courts have interpreted it to cover “remedial expenses.”
State electronic privacy laws
The Supreme Court, in the Quon case, noted that some states have recently passed statutes requiring employers to notify employees when monitoring their electronic communications. It referred to laws in Connecticut and Delaware. Church leaders should be familiar with legislative developments in their state pertaining to workplace privacy.
Issue #4: Application of the Clergy-Penitent Privilege
Every state has a law making certain communications to clergy “privileged.” This generally means that neither the minister nor the “penitent” can be forced to testify in court (or in a deposition or certain other legal proceedings) about the contents of the communication.
Not every communication made to a minister is privileged and thereby protected from disclosure. The typical statute applies only to (1) communications, (2) that are confidential, (3) made to a minister, (4) acting in his or her professional capacity as a spiritual adviser. Some states add a fifth requirement—the communication made in confidence to a clergyman must be made “in the course of discipline.”
Rule 505 of the Uniform Rules of Evidence, which has been adopted by several states, defines the privilege as follows:
(a) Definitions. In this rule:
(1) “Cleric” means a minister, priest, rabbi, accredited Christian Science Practitioner, or other similar functionary of a religious organization, or an individual reasonably believed so to be by the individual consulting the cleric.
(2) A communication is “confidential” if it is made privately and not intended for further disclosure except to other persons present in furtherance of the purpose of the communication.
(b) General rule of privilege. An individual has a privilege to refuse to disclose and to prevent another from disclosing a confidential communication by the individual to a cleric in the cleric’s professional capacity as spiritual adviser.
(c) Who may claim the privilege. The privilege under this rule may be claimed by an individual or the individual’s guardian or conservator, or the individual’s personal representative if the individual is deceased. The individual who was the cleric at the time of the communication is presumed to have authority to claim the privilege but only on behalf of the communicant.
Can conversations with a minister via cell phone, e-mail, or text messaging qualify for this privilege? One court has addressed the application of the clergypenitent privilege to e-mail. WebXchange Inc. v. Dell Inc., 264 F.R.D. 123 (D. Del. 2010). The defendants in a patent infringement lawsuit claimed that the plaintiff was wrongfully withholding three e-mails that had been subpoenaed by the defendants. The plaintiff asserted that the e-mails, which had been exchanged between him and two clergymen for the purpose of obtaining spiritual guidance on a business venture, were protected from disclosure by the clergy-penitent privilege. The defendants claimed that there was no proof that the e-mails were sent to the two clergyman in their spiritual capacity, and the e-mails were not confidential since they were copied to several third persons.
This case supports the conclusion that conversations with clergy via e-mail, cell phone calls, or text messaging can be protected by the clergy-penitent privilege so long as they meet the requirements of the privilege under state law. Perhaps the main objection to the privileged status of these communications is that they are not “confidential” since they can be overheard by others having the right equipment.
While this is true, it is not conclusive. The Uniform Rules of Evidence (quoted above), which has been adopted by many states, clarifies that the essential element of confidentiality means that a communication is “made privately and not intended for further disclosure except to other persons present in furtherance of the purpose of the communication.” It is reasonable to assume that electronic communications with clergy can be confidential even though there is a remote possibility that persons nearby with the right equipment could access the communications. The remote possibility of such access should not negate the fact that the communication was “private” and therefore confidential. To conclude otherwise would be to restrict clergy from engaging in spiritual counseling by means of electronic communications, which in many cases would greatly limit a minister’s ability to respond quickly to urgent needs.
Issue #5: Admissions Against Interest
The rules of evidence followed in both state and federal courts generally prohibit the admissibility of hearsay evidence. Hearsay refers generally to statements not made in court or a judicial proceeding. It is defined by the federal rules of evidence (rules of evidence used in federal courts) as a “statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”
There are some 30 exceptions to the hearsay rule. One of them is “admissions against interest.” This exception is explained in the federal rules of evidence as follows:
A statement that: (A) a reasonable person in the declarant’s position would have made only if the person believed it to be true because, when made, it was so contrary to the declarant’s proprietary or pecuniary interest or had so great a tendency to invalidate the declarant’s claim against someone else or to expose the declarant to civil or criminal liability; and (B) is supported by corroborating circumstances that clearly indicate its trustworthiness, if it is offered in a criminal case as one that tends to expose the declarant to criminal liability.
According to this rule, statements made by church employees in e-mail communications, or while “texting” on a cell phone, may be admissible in court as an exception to the hearsay rule if they are contrary to the “proprietary of pecuniary interest” of the employee making the statement.
Some courts have stressed that this exception to the hearsay rule applies to statements made by employees that are against the interests of their employer only if the statements are potentially against the personal interests of the employees who make them. Consider the following example.
• Example. A youth pastor, while away from the church office, receives a text on his cell phone informing him that a mother of a minor child has accused a volunteer worker in the church’s youth group of molesting her child. The youth pastor texts a response that states, in part, “I am not surprised. I always had a bad feeling about that worker, and I only wish I had done a better job of screening him before selecting him as a volunteer.” The mother later sues the church, and her attorney asks the church to turn over the youth pastor’s e-mails and text messages for the previous two years. The attorney discovers this text message, and plans on introducing it in court as evidence of the church’s negligence. While the youth pastor’s statements are clearly against the church’s interests, this is not enough to qualify for the exception to the hearsay rule. They also must be against his own personal interests.Some courts have interpreted this requirement liberally. To illustrate, one court observed: “To qualify as an exception to the hearsay rule [as an admission against interest] a declaration must be against the employee’s interest, not just the employer’s interest. Since the trustworthiness of the declaration is insured only by the accompanying threat of loss or liability, the statement must be to the declarant’s immediate prejudice …. We note, however, that statements against an employer’s interest may be against the employee’s own pecuniary or proprietary interests if, for example, they threaten the loss of employment or reduce the chances for future employment.” Clearly, to the extent that the youth pastor believes that his employment is in jeopardy, his incriminating cell phone text message could be an admission against interest that would be admissible in court as evidence against both the youth pastor and the church.
• Caution. Church employees should assume that all of their text messages and e-mails will be admissible in court in the event of future litigation. As a result, they should avoid any statements that might be considered admissions against interest.
Issue #6: Sexual Harassment
Many employers have been sued by a current or former employee for job-related sexual harassment. Sexual harassment is a form of “sex discrimination” prohibited by Title VII of the Civil Rights Act of 1964. Equal Employment Opportunity Commission (EEOC) regulations define sexual harassment as follows:
(a) Harassment on the basis of sex is a violation of Sec. 703 of Title VII. Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature constitute sexual harassment when (1) submission to such conduct is made either explicitly or implicitly a term or condition of an individual’s employment, (2) submission to or rejection of such conduct by an individual is used as the basis for employment decisions affecting such individual, or (3) such conduct has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile, or offensive working environment.
According to this definition, sexual harassment includes at least two separate types of conduct:
(1) “quid pro quo” harassment, which refers to conditioning employment opportunities on submission to a sexual or social relationship, and
(2) “hostile environment” harassment, which refers to the creation of an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature.
• Key point. Most states have enacted their own civil rights laws that bar sexual harassment in employment, and it is far more likely that these laws will apply to churches since there is no “commerce” requirement and often fewer than 15 employees are needed to be covered by the law.
While it is possible for employees to use a cell phone to engage in quid pro quo sexual harassment, it is more likely for a cell phone to be used in a manner that constitutes hostile environment sexual harassment, such as the use of a cell phone to send sexually explicit texts or images to another employee. A church may be liable for hostile environment sexual harassment on the basis of the following rules:
harassment committed by nonsupervisory employees
EEOC regulations address employer liability for the sexual harassment of nonsupervisory employees as follows:
With respect to conduct between fellow employees, an employer is responsible for acts of sexual harassment in the workplace where the employer (or its agents or supervisory employees) knows or should have known of the conduct, unless it can show that it took immediate and appropriate corrective action.
hostile environment harassment by a supervisor, with a tangible employment decision
If a supervisor creates an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature, this is hostile environment sexual harassment for which the employer will be legally responsible if the supervisor takes any “tangible employment action” against the employee. A tangible employment action includes “a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits.” The employer is liable under such circumstances whether or not it was aware of the harassment.
hostile environment harassment by a supervisor, with no tangible employment decision
If a supervisor creates an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature, this is hostile environment sexual harassment for which the employer will be legally responsible even if the supervisor takes no “tangible employment action” against the employee. However, in such cases the employer may assert an “affirmative defense” to liability. This defense consists of two elements: (i) The employer “exercised reasonable care to prevent and correct promptly any sexually harassing behavior.” This generally means that the employer adopted a written sexual harassment policy that was communicated to employees, and that contains a complaint procedure. (ii) The victim “unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise.” This generally means that the victim failed to follow the complaint procedure described in the employer’s sexual harassment policy.
• Key point. A written sexual harassment policy does not insulate a church from all sexual harassment liability. It will not serve as a defense in any of these situations: (1) a “tangible employment decision” has been taken against an employee; (2) incidents of quid pro quo sexual harassment; or (3) a victim of a supervisor’s hostile environment sexual harassment pursues his or her remedies under the employer’s sexual harassment policy.
• Key point. EEOC guidelines contain the following language: “Prevention is the best tool for the elimination of sexual harassment. An employer should take all steps necessary to prevent sexual harassment from occurring, such as affirmatively raising the subject, expressing strong disapproval, developing appropriate sanctions, informing employees of their right to raise and how to raise the issue of harassment under Title VII, and developing methods to sensitize all concerned.”
Tip. The assistance of an attorney is vital in the drafting of a sexual harassment policy.
Tip. Church insurance policies generally do not cover employment-related claims, including sexual harassment. If your church is sued for sexual harassment, you probably will need to retain and pay for your own attorney, and pay any judgment or settlement amount. This often comes as a shock to church leaders. You should immediately review your policy with your insurance agent to see if you have any coverage for such claims. If you do not, ask how it can be obtained. You may be able to obtain an endorsement for “employment practices.” Also, a “directors and officers” policy may cover these claims.
The following examples will illustrate the application of Title VII’s ban on sexual harassment to religious organizations.
• Example. Assume that a church is covered by Title VII. A female bookkeeper claims that a male custodian has been sexually harassing her by sending her sexually explicit texts and images with his cell phone. She does not discuss the custodian’s behavior with the senior pastor or church board. She later threatens to file a complaint with the EEOC, charging the church with responsibility for the custodian’s behavior. Since the harassment was not committed by a supervisor having the authority to affect the bookkeeper’s terms and conditions of employment, EEOC guidelines addressing employer liability for sexual harassment specify: “With respect to conduct between fellow employees, an employer is responsible for acts of sexual harassment in the workplace where the employer (or its agents or supervisory employees) knows or should have known of the conduct, unless it can show that it took immediate and appropriate corrective action.” If the pastor and church board were not aware of the custodian’s offensive behavior, then the church will not be legally responsible for it, according to this regulation.
• Example. A church is subject to Title VII. It adopts a written sexual harassment policy that defines harassment, encourages employees to report harassing behavior, and assures employees that they will not suffer retaliation for reporting harassment. A male supervisory employee engages in persistent sexting and other offensive behavior of a sexual nature with a female employee. The female employee is greatly disturbed by this behavior, and considers it inappropriate in a church. In fact, she sought church employment because she considered it a safe environment. The supervisor eventually dismisses the employee because of her refusal to “go along” with his offensive behavior. Throughout her employment, the employee never informed church leadership of the supervisor’s behavior. Several months after her termination, the employee files a sexual harassment complaint with the EEOC. Will the church be liable for the supervisor’s behavior under these circumstances? After all, it was not aware of the supervisor’s behavior, and it adopted a written sexual harassment policy. The supervisor’s behavior may constitute hostile environment sexual harassment for which the church will be liable. The fact that the church leadership was unaware of his offensive behavior is not relevant. Further, the church’s sexual harassment policy is no defense, since the employee suffered a “tangible employment decision” (dismissal) as a result of her refusal to go along with the supervisor’s behavior.
• Example.Same facts as the previous example, except that the employee was not dismissed and suffered no “tangible employment decision” (firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits). The general rule is that an employer is liable for a supervisor’s hostile environment sexual harassment that does not result in a tangible employment decision against the victim. However, the employer has an “affirmative defense” to liability if (1) it adopted a sexual harassment policy that was adequately communicated to employees, and (2) the victim failed to pursue her remedies under the policy. The church in this case qualifies for the affirmative defense. It adopted a sexual harassment policy, and the victim failed to follow the policy’s complaint procedure. As a result, the church probably would not be liable for the supervisor’s behavior.
• Example.Same facts as the previous example, except that the church is not subject to Title VII (it only has five employees). The church still may be liable under a state civil rights law, or under other legal theories (such as “intentional infliction of emotional distress,” negligent selection or supervision, assault and battery, invasion of privacy, or false imprisonment).
Issue #7: The Tax Implications of Cell Phone Use
Many pastors and lay church employees have been using cell phones since they first hit the market back in the 1980s. Remember those early models? They were as big as a suitcase, and air time cost a fortune. Only the wealthiest taxpayers could afford them, and few employers provided them to their employees. As time went on, cell phones were increasingly scrutinized by Congress and the IRS, and here’s why. The vast majority of persons using these phones were using them for both business and personal reasons, but few were valuing the personal use and reporting it as taxable income on their tax return. It never even occurred to most of them that they needed to do so.
In 1989, Congress decided to act. It amended the tax code to add cell phones to the definition of “listed property.” The term listed property refers to various kinds of property, including personal computers and cars, subject to much stricter substantiation rules because of the potential for abuse. Characterizing cell phones as listed property meant that employers and taxpayers could not estimate the amount of business and personal use. Detailed records were necessary to document the date, time, cost, and business purpose of every call. Employers that simply paid the monthly invoices from the cell phone company without requiring employees to provide this level of substantiation were required to report the entire amount it paid as a taxable fringe benefit to its employees. Few did so. In time, cell phones became more compact—they looked more like Star Trek communicators than suitcases, and the cost of air time plummeted.
Employers and employees began wondering if it was worth complying with the substantiation requirements given the declining value of the taxable benefit. To illustrate, if an employer pays $50 a month for an employee’s cell phone, or $600 per year, is it worth having the employee pour over every one of those hundreds of calls on the monthly invoices to prove the business connection? Let’s say that an employee spends hours every month doing this, and ultimately proves that the phone is used half the time for business purposes. Okay, the employer reports the other half as a taxable fringe benefit. If the employee is in the 15 percent tax bracket, that’s a taxable benefit of $45. Most employers considered this to be crazy—and many rebelled. It made no sense to spend hours every month pouring over cell phone invoices to substantiate the purpose of every call. Employers that refused to go along with the listed property rules were in effect providing their employees with a nonaccountable reimbursement when they paid for their use of a cell phone. Going back to the previous example, the employer would simply report the entire cost of the phone, or $600 per year, as a taxable benefit. The employee would pay $90 in taxes on this amount. That’s $45 more than if the employee and employer spent hours every month pouring over those cell phone invoices, but who wouldn’t rather pay the full amount and be done with the hassle?
The problem is that the rationale for treating cell phones as listed property has ceased to exist. Technology made these devices small and cheap. The potential for abuse was greatly reduced. But Congress did nothing to recognize this, and this led to mounting confusion as employers struggled with how to handle the tax implications.
Fortunately, Congress acted. Late in 2010, it enacted the Creating Small Business Jobs Act. The Act removes cell phones from the definition of listed property. As a result, the heightened substantiation requirements and special depreciation rules that apply to listed property do not apply to cell phones. This provision is effective for taxable years ending after December 31, 2009. This legislation allows employers and employees to come up with reasonable estimates of the personal use of employer-provided phones. It also allows employees to claim a depreciation deduction for cell phones that they purchase for business use without having to establish that the phones meet the “condition of employment” and “convenience of the employer” requirements.
IRS Commissioner Douglas Shulman publicly supported this legislation. The IRS took additional steps to address the cell phone problem in September 2011 when it issued guidance on two issues associated with cell phone use:
(1) When an employer provides an employee with a cell phone primarily for noncompensatory business reasons, the business and personal use of the cell phone is generally nontaxable to the employee. The IRS will not require recordkeeping of business use in order to receive this tax-free treatment. IRS Notice 2011-72.
(2) Employers that require employees, primarily for noncompensatory business reasons, to use their personal cell phones for business purposes may treat reimbursements of the employees’ expenses for reasonable cell phone coverage as nontaxable. This treatment does not apply to reimbursements of unusual or excessive expenses or to reimbursements made as a substitute for a portion of the employee’s regular wages. IRS News Release IR-2011-93, IRS Notice 2011-72.
Resource. The use of cell phones by church employees raises several tax issues that need to be carefully considered. These are all addressed fully in Richard Hammar’s annual Church & Clergy Tax Guide (available at ChurchLawAndTaxStore.com).
Issue #8: Fair Labor Standards Act
Does time spent by employees performing work-related tasks on a smartphone during nonworking hours count in computing their right to overtime pay under the federal Fair Labor Standards Act? This question was addressed by a federal court in Illinois in a recent case that is addressed in the Recent Developments section of this newsletter (page 23).
Issue #9: OSHA
The Occupational Safety and Health Act of 1970 was enacted to prevent workers from being killed or seriously harmed at work. The law requires that employers provide their employees with working conditions that are free of known dangers. The Occupational Safety and Health Administration (OSHA) establishes and enforces protective workplace safety and health standards.
OSHA recently made the following announcement:
The Occupational Safety and Health Administration’s top priority is keeping workers safe. While we experience fewer fatalities in the workplace today, the leading cause of worker fatalities year after year are motor vehicle crashes; distracted driving dramatically increases the risk of such crashes. The Department of Labor through OSHA is partnering with the Department of Transportation to combat distracted driving.
OSHA will first focus on texting while driving. Employers should prohibit any work policy or practice that requires or encourages workers to text while driving. Texting while driving greatly increases the risk of being injured or killed in a motor vehicle crash. Prohibiting texting while driving is the subject of [an Executive Order] signed by President Obama last year for Federal employees, and the subject of rulemaking by the Department of Transportation. We call upon all employers to prohibit any work policy or practice that requires or encourages workers to text while driving. The Occupational Safety and Health Act of 1970 is clear—employers must provide a workplace free of serious recognized hazards. It is well recognized that texting while driving dramatically increases the risk of a motor vehicle injury or fatality. It is imperative that employers eliminate financial or other incentives that encourage workers to text while driving. Employers who require their employees to text while driving—or who organize work so that doing so is a practical necessity even if not a formal requirement—violate the Occupational Safety and Health Act.
We call upon all employers to follow the lead of President Obama, the Department of Transportation and 30 state laws that prohibit drivers from texting—to prohibit their employees from texting while driving for work.
OSHA is launching a multi-pronged initiative that will include the following:
By prohibiting texting while driving, we are working to ensure that workers are safe on the road and that they return home safely at the end of their shift.
application to churches
OSHA regulations clearly specify that nonprofit organizations are subject to OSHA regulations:
The basic purpose of the Act is to improve working environments in the sense that they impair, or could impair, the lives and health of employees. Therefore, certain economic tests such as whether the employer’s business is operated for the purpose of making a profit or has other economic ends, may not properly be used as tests for coverage of an employer’s activity under the Act. To permit such economic tests to serve as criteria for excluding certain employers, such as nonprofit and charitable organizations which employ one or more employees, would result in thousands of employees being left outside the protections of the Act in disregard of the clear mandate of Congress to assure “every working man and woman in the Nation safe and healthful working conditions.” Therefore, any charitable or nonprofit organization which employs one or more employees is covered under the Act and is required to comply with its provisions and the regulations issued thereunder.
However, OSHA regulations treat churches as a special case. Here is what the regulations say:
Churches or religious organizations, like charitable and nonprofit organizations, are considered employers under the Act where they employ one or more persons in secular activities. As a matter of enforcement policy, the performance of, or participation in, religious services (as distinguished from secular or proprietary activities whether for charitable or religion-related purposes) will be regarded as not constituting employment under the Act. Any person, while performing religious services or participating in them in any degree is not regarded as an employer or employee under the Act, notwithstanding the fact that such person may be regarded as an employer or employee for other purposes—for example, giving or receiving remuneration in connection with the performance of religious services.
This language is very important. It demonstrates that OSHA considers churches to be subject to the provisions of the Act and regulations, but for policy reasons no “enforcement” action will be taken against a church that violates OSHA regulations in the course of “the performance of, or participation in religious services” since “any person, while performing religious services or participating in them in any degree is not regarded as an employer or employee under the Act, notwithstanding the fact that such person may be regarded as an employer or employee for other purposes.”
OSHA regulations list the following examples of religious organizations that would not be covered employers under the law:
The regulations demonstrate that OSHA considers church activities outside the narrow context of religious services to be subject to the Occupational Safety and Health Act. As a result, church leaders should be familiar with any OSHA regulations banning text messaging by employees, since driving is not an act of worship and therefore is subject to OSHA regulation. OSHA can assess penalties against any covered employer, including churches, that violate OSHA regulations.
Issue #10: Cyberattacks
The use of smartphones and tablets by church employees creates a risk of cyberattack, data mining, and identity theft. Several recent studies have documented the widespread personal use of employerprovided smartphones and tablets by employees, and the use of employees’ personally owned smartphones and tablets for business-related tasks. Either way, these devices can store highly confidential information (Social Security numbers, bank account numbers, passwords, and so on) that can lead to serious security breaches and identity theft if they are stolen or accessed electronically. This risk is elevated by the fact that many employers and employees do not recognize or respond to this risk, and so few, if any, preventive actions are taken. One security expert has observed, “Smartphones and tablets have become the new onramp for information, applications and commerce—yet they are quickly becoming an onramp for security threats as well.”
There are many precautions that church leaders can take to reduce this risk. These include:
Check with an information technology professional for additional safeguards.
What this means for churches
Issuing electronics devices is more than a matter of how much to spend and what to buy. Churches must know laws, ordinances, and strategies for these devices as they relate to driving, computer inspections, workplace privacy, clergy-penitent privilege, sexual harassment policies, tax implications, and cyberattack prevention.