In the three-year saga over anticipated changes to the minimum salary threshold for overtime exemptions under the Fair Labour Standards Act, the latest – and probably final – development occurred on 24 September 2019, when the US Department of Labour issued its new final rule updating the regulations in this regard. The new regulations will become effective on 1 January 2020. As such, employers must evaluate their workforces to identify positions that will need to be reclassified or modified.
Assembly Bill (AB) 5 has finally been signed into law, making it more difficult for California businesses to classify workers as independent contractors. AB 5 codifies and expands the California Supreme Court's holding in Dynamex and applies the 'ABC' test to most independent contractor questions under California employment law. Now that it has been signed into law and its retroactive effect codified, employers must audit their independent contractor arrangements and pay close attention to the exemptions.
The National Labour Relations Board recently issued a decision that expands the Supreme Court's decision in Epic Systems Corp v Lewis and further authorises employers to limit employees' ability to file or opt in to a class or collective action against their employer. In light of the decision, employers may not only require employees to enter an arbitration agreement that requires one-on-one arbitration, but also impose such an agreement after, and in response to, employees filing or opting in to a class or collective action.
For US employers with 100 or more employees, extensive new information relating to their prior Equal Employment Opportunity-1 filings must soon be submitted. Specifically, in addition to categorising employees by race or ethnicity, gender and job type, employers must now assemble and submit aggregated employee data regarding compensation and annualised hours worked. Assembling the required data may be much more complicated than many employers are expecting, so it is important to begin planning now.
This article reviews the impact of the #MeToo movement, and other corporate culture concerns, on employers and its connection with the Supreme Court's decision in Epic Systems. There is concern that the court's decision will, in many cases, deprive women and men who have been victims of sexual assault or harassment in the workplace of their right to bring collective or class actions, as Epic Systems has forced employees to bring their claims through one-on-one arbitration.
As employers doing business in California know, California's employment regulatory scheme is the most comprehensive of any US state. In particular, the California Private Attorneys General Act (PAGA) allows employees to sue employers for civil penalties on behalf of themselves and other employees. Most significantly, PAGA provides for the reimbursement of attorneys' fees to employees who successfully bring suit. However, Epic Systems may mean a change in favour of standalone PAGA cases.
One year after the Supreme Court's landmark decision in Epic Systems – which paved the way for employers to force employees to waive their right to bring class actions – this article revisits the court's decision and the pros and cons of mandatory arbitration programmes with class action waivers.
Senate Bill 121 has amended New Jersey's longstanding Law Against Discrimination to prohibit any contractual provision that conceals "the details relating to a claim of discrimination, retaliation, or harassment". Notably, the new law applies to all existing and future agreements, except collective bargaining agreements. The law also preserves the enforceability of certain restrictive covenants, including non-competition agreements and provisions protecting confidential and proprietary information.
The Department of Labour has issued proposed revisions to the definition of 'joint employer' under the Fair Labour Standards Act in order to clarify the joint employer relationship. The joint employment rule allows multiple employers to be responsible for paying hours worked by a shared employee under certain circumstances.
The US Department of Justice (DOJ) recently filed a brief in the Supreme Court arguing that Title VII of the Civil Rights Act does not prohibit discrimination based on gender identity. The brief underscores the DOJ's sharp disagreement with the Equal Employment Opportunity Commission. Until the Supreme Court provides more clarity on this issue, employers should consider reviewing their employment policies and hiring practices to ensure that they are treating transgender status as a protected category.
The California Court of Appeal for the Fourth Appellate District recently held that individuals can be held personally liable for civil penalties under the California Labour Code. The decision serves as an important reminder for employers that compliance with wage and hour laws should be a primary concern. Under the decision, employees can hold individual owners personally liable for penalties associated with wage and hour violations, in addition to attorneys' fees and costs.
A California appellate court has ruled that the California Supreme Court's recent decision in Dynamex Operations West, Inc v Superior Court, which established a new test for determining whether to classify workers as independent contractors, is limited to claims under the Industrial Welfare Commission's wage orders. After the decision in Dynamex, there has been some uncertainty about whether the test applies to Labour Code claims as well as wage order claims.
The Tenth Circuit recently issued a decision in which it reversed the dismissal of the US Department of Labour's lawsuit against a janitorial company for misclassifying janitorial workers as independent contractors. The decision emphasises that if the economic realities suggest that workers are in fact employees, the existence of corporate intermediaries in the contractual relationship will not immunise employers from liability under the Fair Labour Standards Act.
The Occupational Safety and Health Administration recently issued a guidance memorandum clarifying its position on workplace safety incentive programmes and post-incident drug testing. Employers should review this memorandum, including the specific examples of lawful policies and programmes, in evaluating whether their policies and programmes are likely to have a negative impact on employees reporting workplace injuries or illnesses.
A unanimous panel of the Sixth Circuit recently held that the Fair Labour Standards Act does not prohibit employers from requiring employees to execute arbitration agreements with class or collective action waivers. The decision joins those from other federal courts of appeal in holding that claims under the Fair Labour Standards Act are subject to agreements to arbitrate on an individual basis.
The Ninth Circuit recently held that a settlement of class claims in an opt-out class action asserting only state law wage and hour claims also released the plaintiff's Fair Labour Standards Act claims arising from the same allegations on which her state claims had been predicated. The decision reinforces the importance of carefully crafting release language in all settlements, including class action settlements, and provides guidance on what language to include in such releases to preclude future claims.
The National Labour Relations Board (NLRB) recently issued a new guidance memorandum clarifying the standard that it will apply when interpreting employer workplace policies and handbooks following its recent decision in The Boeing Co. The guidance memorandum clarifies that post-Boeing, many employment policies and procedures that may have been deemed unlawful under the previous NLRB General Counsel memoranda will now be upheld.
A New York intermediate appellate court has handed Postmates a victory in the ongoing battle over employment status in the gig economy. Although this decision is not binding on courts outside of New York's Third Department, it provides useful information to gig economy companies on how to structure their operations in jurisdictions where classification status is largely determined by the employer's level of control.
Previously, there was some uncertainty among California state and federal courts about whether coverage for accidents under general liability insurance policies extended to claims for negligent employment practices. However, a recent California Supreme Court case makes clear that such claims are covered and expresses a strong policy preference in favour of that coverage.
The US Court of Appeals for the Second Circuit recently reversed its prior precedent and held that Title VII's prohibition on sex discrimination includes a prohibition on sexual orientation discrimination. For years, states and municipalities have been adding laws prohibiting discrimination based on sexual orientation. However, whether Title VII prohibits discrimination based on sexual orientation under federal sex discrimination prohibitions has been actively debated in both courts and administrative agencies.