HR Legal Updates
Special thanks this month to Audrey E. Mross, Labor and Employment Attorney for Munck Carter, LLP, for this month’s legal update. Mross provides free legal updates to her email group. To be added, contact her at firstname.lastname@example.org.
School’s out, but your education never ends:
On June 7, the U.S. Secretary of Labor rescinded two Obama-era guidance documents, on joint employment and on independent contractors. The July 15, 2015 guidance provided a six-factor test for determining employee vs. independent contractor status and concluded that most individuals would be deemed employees for purposes of the Fair Labor Standards Act. The January 2016 guidance explained how two or more entities could be sufficiently related, either horizontally or vertically, to establish them as joint employers (with joint liability for a host of employment law violations). It remains to be seen if these interpretations will be replaced or simply evaporate, but don’t get too comfortable. The underlying federal law has not changed and many state governments have jumped in on the misclassification issue, both to protect the rights of individuals and to line their own coffers via various employment taxes.
Never Mind, Part Two
The Department of Labor’s “persuader rule” has been on life support since an injunction blocked implementation of the rule in June 2016. The other shoe has now dropped, with DOL filing a NPRM to rescind the rule entirely, for now, so that they can take a closer look at how “indirect” persuasion has evolved and determine whether the 1962 definitions of reportable activity need to be tweaked. We are now in the 60-day comment rule for the NPRM, so if you have an opinion now is the time to speak your piece. Also, on June 15 the 5th Circuit OK’d the DOL’s request to stay the appeal of the injunction until December 12, 2017.
Never Mind, Part Three
The Deferred Action for Parents of Americans (DAPA) memorandum was created during the Obama administration to allow undocumented parents of U.S. citizens and lawful permanent residents to defer deportation via a series of three-year work authorization stints. DAPA was stopped via injunction before it took effect, in 2015, and on June 15, 2017, the Department of Homeland Security rescinded the program entirely. Deferred Action for Childhood Arrivals (DACA) remains in effect.
Never Mind, Part Four
While not entirely unexpected, it is still stunning to see the Department of Justice do a complete 180 in its position relative to litigation pending before the U.S. Supreme Court. Three consolidated cases are being used to figure out whether an employment contract provision that waives the employee’s right to participate in a class action violates the NLRA. During the Obama administration, the DOJ argued that the waivers violate employee’s NLRA Section 7 rights and are unenforceable. Now, with a new boss in town, they filed a brief on June 16 stating that the DOJ has reconsidered the issue and has reached the opposite conclusion.
Never Mind, Part Five?
The Workforce Democracy and Fairness Act (S. 1350) was filed in Congress on June 15, to revoke the NLRB’s “ambush election rules” which took effect in April 2015 and dramatically shortened the length of union campaigns leading up to the employee’s vote. See https://www.alexander.senate.gov/public/index.cfm/sponsoredbills for more info.
Take a Seat
President Trump nominated Marvin Kaplan, who is currently counsel to the Occupational Safety and Health Review Commission, to fill one of the two empty seats on the NLRB. The other seat should be warmed by William Emanuel, who is a management-side labor attorney in private practice in Los Angeles, CA. If both are confirmed by the August recess, they join the current chair, Philip Miscimarra, in creating a Republican majority on the five-member board for the first time in a long time.
Update on “This is a Recording”
In the last issue of LB4HR, I wrote about an NLRB ALJ decision finding that the employer’s policy banning employees from recording any workplace conversations without approval from the company’s legal department violated Section 8 of the NLRA, which prohibits employers from interfering with employees’ Section 7 rights (to organize or engage in similar concerted activity relating to terms and conditions of employment). The employer, Whole Foods, appealed to the 2nd Circuit. The 2nd Circuit affirmed the ALJ’s decision via an unpublished summary order.
Update on Swing in FLSA Salary
In a Congressional committee hearing on June 7, the Secretary of Labor said the agency plans to seek further public comment on where the minimum salary to maintain most FLSA exemptions should go . At his confirmation hearing in March, Secretary Acosta mused that the current level of $23,600/year was too low and should be raised to “somewhere around $33,000.” The proposed increase to $47,476 was nixed via injunction late last year.
Stated Differently – Here are some hot topics for your multi-state employers:
- California – Effective July 1, 2017, employers are limited in using the criminal history of a job applicant when making hiring decisions. The law prohibits use of such information if it results in an adverse impact on a protected category (e.g., race, gender, national origin). If the applicant can show adverse impact, the burden shifts to the employer to show the use of such information is job-related and a business necessity, applying a test created by the California Fair Employment and Housing Council. For more details about the standard, see https://www.dfeh.ca.gov/wp-content/uploads/sites/32/2017/06/Text-HoueRegDiscriminatoryEffectLandUsePracticesandCriminalHistory.pdf.
- Delaware – Effective mid-December 2017 (six months after June 14 signing), employers in DE may not screen job applicants based on their pay history or seek that information from the applicant or the applicant’s prior employers. A copy of House Bill 1 is posted at http://src.bna.com/pSX. [Note: There is a big difference between this 1.5 page bill and the 11-page bill for Oregon employers, below]
- Nevada – Effective June 3, 2017, the law regulating employers’ use of post-employment noncompete provisions has been modified to  allow “blue penciling” of an overbroad agreement to make it enforceable;  limit the temporal (time) scope of the restriction to the period during which the former employee is receiving pay/benefits continuation or equivalent compensation when employment ends due to a RIF, reorganization or restructuring; and  a noncompete of customers will not be enforced if [a] the former employee did not make first contact with the customer; [b] the customer voluntarily shifted business away from the former employer of the employee; and [c] the former employee is otherwise compliant with the noncompete agreement.
- New York City – Effective November 26, 2017, a host of new requirements referred to as the Fair Workweek law will take effect, impacting restaurant and retail employees. The measures focus on employer’s scheduling practices by  requiring employers to provide at least two weeks’ advance written notice of work schedules;  pay employees $100 for “clopenings” (closing one shift and openings the next with insufficient time off in between);  offer open shifts to existing staff before hiring new workers; and  honor an employee’s request to deduct and remit charitable donations from his or her pay. The enforcing agency has a great compilation of info on these changes at https://www1.nyc.gov/site/dca/about/office-of-labor-policy-standards.page.
- Ohio – Effective March 21, 2017, OH employers may not prohibit any person with a conceal carry permit from transporting or storing a firearm in their personal vehicle while on the employer’s property. The weapon must be hid or secured before exiting the vehicle and cannot be removed or handled for any purpose while at work.
- Oregon – Effective in September 2017 (91 days after the legislature adjourns), the OR Equal Pay Act will prohibit discrimination in pay based any “protected class”, prohibit screening of job candidates based on past pay and prohibit determination of current pay based on past pay from other employers (but OK to consider current pay for movement within the same employer). The 11-page bill is posted at http://src.bna.com/pdV.
- Rhode Island – A RI Superior Court recognized a private right of action for employment discrimination involving medical marijuana (MM) card holders. The employer rescinded the offer of an internship after learning that the student was a card holder. The applicant explained that she was allergic to most pain meds and would need to use MM during the internship but would not bring the substance to work or be under the influence while at work. Relying on the requirement of a clean pre-hire drug screen (which the applicant would fail), the offer was rescinded. In granting the applicant’s MSJ against the employer, the court dismissed the employer’s arguments that the MM statute did not contain an express private right of action and that the state disability anti-discrimination law offered no protection or accommodation obligation for illegal drug use. The federal Drug Free Workplace argument didn’t work, either, because it only regulates use of illegal drugs in the workplace. Callagan v. Darlington Fabrics Corp. (R.I. Super. Ct. June 2017)
- Seattle, WA – Effective July 1, 2017, the Secure Scheduling Ordinance will apply to food or retail establishments with 500+ employees worldwide and at least 40 full-service restaurants. It will require provision of an individual good faith estimate to employees of their median hours and potential for being on-call. This information is to be available immediately for new hires on or after July 1 and commencing no later than Sept. 28, 2017 for existing employees. More info on the measure is posted on the website of the enforcing agency at https://www.seattle.gov/laborstandards.
- Washington – Effective July 23, 2017, WA becomes the third state (after IL and TX) to regulate collection, use and disclosure of biometric information. For full text of HB 1493 see https://legiscan.com/WA/text/HB1493/id/1623284.