Employment Law Alert

Employment Law Alert

News and Updates on Employment Law

Supreme Court Accepts Use of Representative Sample To Prove Classwide Liability

Posted in Labor

In Tyson Foods, Inc. v. Bouaphakeo, the Supreme Court of the United States definitively answered the question of whether statistical “representative evidence” may be used in class actions to establish that “questions of law or fact common to class members predominate over any questions affecting only individual members” pursuant to Rule 23(b)(3). According to the Court’s much-anticipated opinion, the answer is yes: “Its permissibility turns not on the form a proceeding takes – be it a class or individual action – but on the degree to which the evidence is reliable in proving or disproving the elements of the relevant cause of action.”

In Tyson, employees had filed a class action suit against their employer, Tyson Foods, Inc., alleging violations of the Fair Labor Standards Act of 1938 based on the failure to pay required overtime compensation for the donning and doffing of protective gear necessary for their hazardous work. Because Tyson Foods did not maintain records of donning and doffing time, the employees relied on representative evidence, which included testimony, video recordings, and an expert study, to show the average amount of donning and doffing time for each employee. The jury awarded the class approximately $2.9 million for unpaid wages, and the judgment and award was affirmed by the Court of Appeals for the Eighth Circuit.

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EEOC to Release Respondent Position Statement to Charging Party Upon Request

Posted in Policies/Handbooks

The Equal Employment Opportunity Commission (“EEOC”) has issued new, nationwide procedures allowing a Charging Party or his/her representative to request copies of Respondent employer’s position statement and non-confidential attachments during the investigation of his/her charge of discrimination. The new procedures apply to all position statements submitted after January 1, 2016. Employers must be cognizant of this new rule and strategically craft positions statements with an eye towards disclosure. Specifically, employers need to carefully separate confidential information into separately labeled attachments to avoid inadvertent disclosure to the Charging Party.

Procedure
The EEOC has prepared a “Questions and Answers for Respondents on EEOC’s New Position Statement Procedures” which explains the new procedures. To summarize, in order to comply with the new rules, Respondents must submit a position statement within thirty (30) days that explains its “version of the facts” and identifies the “specific documents and evidence supporting its position.” If the Respondent refers to confidential information in the position statement, it should note the exhibit as “confidential.” For instance, “Confidential Exhibit A.” It must then create separate labeled attachments titled, as applicable, either: “Sensitive Medical Information,” “Confidential Commercial Information,” “Confidential Financial Information,” or “Trade Secret Information.”

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Department of Labor’s New “Persuader” Rule Requires Employers and Labor Relations Consultants to Publicly Disclose Arrangements

Posted in Labor

On March 24, the United States Department of Labor (“DOL”) published a final rule imposing new reporting requirements under the Labor-Management Reporting and Disclosure Act (“LMRDA”) that could impede employers’ communications with their workers about unions. The rule will take effect on April 25, and will cover arrangements, agreements, and payments between employers and their labor relations consultants – including their attorneys – beginning July 1, 2016.

The law already requires employers and labor relations consultants to file reports with the government detailing expenditures, activities, agreements, and arrangements undertaken to persuade employees regarding their rights to join or refrain from joining unions, but the reporting requirement is waived if the consultants do nothing more than “giv[e] or agree[] to give advice to [the] employer.” Accordingly, businesses and their consultants are not required to publicly disclose their arrangements unless a consultant makes direct contact with company employees under the existing rule.

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Republicans Propose Bill Invalidating DOL’s Proposed Final Rule Regarding Overtime Exemptions

Posted in Wage & Hour

Senate and House Republicans pushed back on the DOL’s proposed final rule on the “white-collar” overtime exemptions by proposing a new bill, the Protecting Workplace Advancement and Opportunity Act, seeking to invalidate the DOL rule.

Under current regulations, employees must satisfy certain tests regarding the job duties they perform and be paid at least $23,660 per year, on a salary basis to be considered exempt under the FLSA’s “white-collar exemptions.” The DOL’s proposed final rule, however, seeks to more than double the minimum salary level from $23,660 to $50,440 per year and provides for automatic annual increases to the minimum salary threshold. Although the proposed final DOL rule does not include any specific changes to the “job duties” component of the exemptions, such changes may be included in the final rule.

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Plainfield Becomes 12th New Jersey Municipality to Approve Paid Sick Leave

Posted in Policies/Handbooks

On March 14, 2016, Plainfield became the 12th New Jersey municipality to approve paid sick leave. The Plainfield ordinance, which will take effect on July 14, 2016, requires that, with certain exceptions, employees working in Plainfield for at least 80 hours per year accrue at least one hour of paid sick time for every 30 hours worked. Employers with ten or more paid employees must provide employees with up to 40 hours of paid sick time per calendar year, and employers with less than ten paid employees must provide sick time up to 24 hours, except for employees who are child care workers, home health care workers and food service workers who are entitled to up to 40 hours of paid sick time. Employees begin to accrue sick time on the first day of their employment and are entitled to begin using their accrued time on the 100th calendar day of their employment. Additionally, employees are permitted to carry over up to 40 hours of paid sick leave to the next calendar year, but employers are not required to carry over more than 40 hours. Employees may use paid sick time for the following reasons:

  • The employee’s own mental or physical illness, injury, or health condition or the employee’s need for medical diagnosis, care, or treatment of his/her own health condition; the employee’s need for preventative care;
  • The employee’s need to care for a family member with a mental or physical illness, injury, or health condition; care of a family member who needs medical diagnosis, care, or treatment of a health condition; or care of a family member who needs preventive medical care;
  • The employee’s place of business is closed due to a public health emergency; or an employee’s child’s school or place of care has been closed due to a public health emergency; or to care for a family member who may have been exposed to a communicable disease.

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Ban the Box Law Amendments Are Now Effective in Philadelphia

Posted in Policies/Handbooks

On March 14, 2016, the amendments to Philadelphia’s “ban the box” law went into effect. The amendments to the city’s Fair Criminal Record Screenings Standards Ordinance (the “Ordinance”), signed into law by Philadelphia’s then Mayor, Michael Nutter, on December 15, 2015, create additional restrictions under the Ordinance on how and when an employer may consider a prospective employee’s criminal background during the application process (beginning when an applicant makes an employment inquiry and ending when the employer has extended a conditional offer of employment).

The amendments make several notable changes to the Ordinance, including those changes listed below:

  • Application: The Ordinance now applies to private employers which employ “any persons within the City of Philadelphia.”
  • No Criminal Inquiry Until Conditional Offer: Employers are prohibited from inquiring or requiring applicants to disclose or reveal their conviction histories during the application process. However, employers may discuss any criminal convictions voluntarily disclosed by applicants.

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Wellness Programs for a Healthy Workplace

Posted in Employee Benefits

At the Fifth Annual Gibbons Employment & Labor Law Conference for clients of the firm, we presented a program entitled “Wellness Programs for a Healthy Workplace.” Cathy Kenworthy, President and CEO of Interactive Health, discussed the business case for implementing wellness programs in our workplaces, while I addressed the numerous laws impacting such programs. Below are some top takeaways from our presentation:

  • Implementing a wellness program can result in soft dollar and hard dollar benefits, as well as improve workplace culture. Lowering the cost of health care is just one of the tangible benefits of a wellness program. Employers also see improvements in productivity and work quality and an increased ability to recruit and retain employees. Interactive Health’s data illustrates health improvements in all risk levels by year two of a wellness program.
  • The business principles associated with what makes for an effective wellness program are the very same principles that are reinforced with emerging case law, rules and the regulatory environment. Interactive Health’s data showed that 95% of the programs implemented among their client base both achieve significant impact and are “green” with regard to legal risk, i.e., they do not cross into any of the issues recently pursued in courts.

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The Walls Have Ears: NLRB Invalidates Employer’s Prohibition on Recording in the Workplace

Posted in Policies/Handbooks

Whole Foods Markets received the proverbial ugly holiday sweater in the form of a December 24, 2015, 2-1 decision by the National Labor Relations Board that declared its policy prohibiting recording in the workplace unlawful. The decision in the cases Whole Foods Markets, Inc. and United Food and Commercial Workers Local 919 and Workers Organizing Committee of Chicago, focused on two rules contained in Whole Foods’ General Information Guide. The first prohibited the recording of meetings, with the laudable, express goals of encouraging “open communication, free expression of ideas, spontaneous and honest dialogue and an atmosphere of trust.” The only exceptions were when the recording was approved by management or all parties to the conversation consented. The second rule also prohibited the use of a recording device in order to “eliminate a chilling effect on the expression of views that may exist when one person is concerned that his or her conversation with another is being secretly recorded.” Seems fair, right? Not according to the NLRB.

The majority (Chairman Pearce and Member Hirozawa) determined that the rules, despite their stated purposes, could be reasonably construed by employees as prohibiting activity protected by Section 7 of the National Labor Relations Act, and, if left intact, would unreasonably chill employees in their exercise of Section 7 rights. Section 7 grants employees the right to, among other things, engage in “concerted activities” for their “mutual aid or protection.” The majority cited testimony offered by Whole Foods’ Global Vice President of Team Member Services that the rules applied regardless of whether the employee was engaged in protected concerted activity. The rules did not offer any exception for an employee who was exercising his Section 7 rights by using a recording device. The broad, unlimited language in the rules was their undoing.

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EEOC to Collect Wage and Hour Data Based on Race, Ethnicity, and Gender in Effort to Aid Enforcement of Laws Requiring Pay Equity

Posted in Wage & Hour

The United States Equal Employment Opportunity Commission (“EEOC”) has proposed a change to the EEO-1 Report, the standard form used to collect workforce profiles from certain private industry employers and federal contractors. In its current iteration, the form annually requires employers to categorize their workforces based on gender, race, ethnicity, and job category, using data collected from one pay period occurring in July, August, or September of the reporting year. The amended form would require further categorization of employees based on W-2 earnings and hours worked.

Employers filing the new EEO-1 Report will have to place the number of employees from each background and job category into one of twelve “pay bands,” which reflect annual wages or salaries ranging from “$19,239 and under” to “$208,000 and over.” Employers must also include the total number of hours worked by the employees in each pay band. Notably, the EEOC “is not proposing to require an employer to begin collecting additional data on actual hours worked for salaried workers, to the extent that the employer does not currently maintain such information.” Accordingly, the EEOC has encouraged employers to comment on the issue, and has suggested that they use a 40 hour per week estimate for full-time salaried employees.

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Federal DOL Issues Joint Employer Guidance to Interpret FLSA and MSPA

Posted in Family Leave, Wage & Hour

The U.S. Department of Labor (“DOL”), Wage and Hour Division (“WHD”) recently issued an Administrator’s Interpretation (“Interpretation”) on joint employer liability under the Fair Labor Standards, Act, 29 U.S.C. § 1801 et seq. and the Migrant Seasonal Agricultural Worker Protection Act, 29 U.S.C. § 201 et seq., that provides additional guidance to employers but also may demonstrate the DOL’s increased efforts to focus on joint employer liability for wage and hour compliance. According to the WHD, the workplace increasingly involves use of outsourcing, shared employees, integrated employers, and other forms of co-dependent business models. The WHD seeks to ensure compliance with wage and hour laws for entities that rely upon such alternative workforces. While the Interpretation is not binding upon the courts and constitutes guidance for employers, it lists factors extrapolated from court decisions, other DOL guidance, and related sources that should be considered where an employer utilizes alternative labor sources or has sister or related entities that share common operations or are interdependent.

Horizontal Joint Employment
Horizontal joint employment, which consists of two or more entities that are sufficiently associated to control the employment relationship of the target employees, might include, for example, separate restaurants that share economic ties and have the same managers, or home health care providers that share staff and have common management. According to the Interpretation, horizontal joint employer analysis focuses on the relationship between two or more employers. Specific factors outlined in the Interpretation include:

  • The owners of the potential joint employer;
  • The existence of overlapping officers, directors, executives or managers;
  • Shared control by the potential employers over operations (including hiring, firing, payroll, advertising, and overhead costs);
  • Intermingling of operations (such as a single person or department for administrative operations, scheduling, and payment of wages);
  • Supervision by the potential joint employer over the work of the other;
  • Shared management between the potential joint employer and the other;
  • Shared employees between the potential joint employer and the other;
  • Shared clients between the potential joint employer and the other; and
  • The existence of agreements between the potential joint employer and the other.

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