Employment Law Alert

Employment Law Alert

News and Updates on Employment Law

Eleventh Circuit Widens Circuit Split on Accommodation Issue

Posted in Disability

Consider the following scenario: Because of a disability an employee is unable to perform an essential function of his or her current position and there is no reasonable accommodation that will enable the employee to remain in that position. The disability, however, will not prevent the employee from performing the essential functions of an open position for which the employee is qualified. A number of courts presented with this scenario have had to decide the extent to which the Americans With Disabilities Act (ADA) mandates that the employer assign the disabled worker to the open position as a reasonable accommodation without requiring the employee to compete for the position with other qualified candidates.

Recently, in Equal Employment Opportunity Commission v. St. Joseph’s Hospital, Inc., the United States Court of Appeals for the Eleventh Circuit joined the Eighth Circuit in concluding that there is no ADA violation if the employer requires the disabled employee to compete for the open position. Other courts, however, including the Seventh, Tenth, and D.C. Circuits have concluded that, in most instances, a qualified disabled employee should be placed in the open position as a reasonable accommodation. The Seventh Circuit’s decision is the subject of an earlier blog.

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The Third Circuit Goes Its Own Way on ADEA Disparate Impact Claims

Posted in Discrimination

The Age Discrimination in Employment Act (ADEA) protects from discrimination employees who are at least 40 years of age. Recently, in Karlo v. Pittsburgh Glass Works, the United States Court of Appeals for the Third Circuit departed company with three of its sister Circuits by holding that plaintiffs asserting a claim of “disparate impact” under the ADEA may establish a disparate impact with comparisons between subgroups of employees and need not show that a challenged employment practice has had an adverse impact on employees 40 years of age or older compared to its impact on employees under 40. Thus, the Court permitted to go forward a disparate impact claim based on a comparison between employees at least 50 years of age with employees under 50. The decision will have a profound impact on employers’ assessments of their potential ADEA liability for disparate impact claims and on the way ADEA disparate impact claims are litigated in the Third Circuit.

To establish a claim of disparate impact discrimination under the ADEA, a plaintiff must show, through statistical evidence, that the employer implemented a facially age-neutral employment practice that fell more harshly on the protected group. If this showing is made, the employer can defeat the claim by demonstrating that the practice in question is justified by reasonable factors other than age.

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Philadelphia Adopts Wage Equity Ordinance

Posted in Wage & Hour

On January 23, 2017, Philadelphia Mayor Jim Kenney signed the Wage Equity Bill into law. The new law, influenced by the Massachusetts pay equity law, makes it unlawful for Philadelphia employers and employment agencies to ask about an applicant’s wage and benefit history or to rely on such applicant’s wage history to determine future wages. The law also prevents employers from retaliating against any candidate who fails to respond to any wage inquiry.

The law takes effect on May 23, 2017, and aims to address historic wage gaps which affect women and minorities, by prohibiting employers from basing compensation on a candidate’s wages at a previous employer, given the historical pay inequities between men and women and minorities. In its “finding” sections, the new law provides statistical examples of wage disparities and encourages employers to set salary offers based on the job responsibilities of the position sought, rather than prior wages.

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NYS Department of Labor Proposed Overtime Rule

Posted in Wage & Hour

With the final overtime rule for the “white collar” exempt employee minimum salary level issued by the United States Department of Labor (the “DOL”) on hold, the New York State Department of Labor’s proposed overtime rules may take precedence for New York employers. As we previously communicated, the DOL’s new overtime rule – which substantially increases the minimum salary that employers must pay to certain classes of employees to avoid the overtime pay requirements of the federal Fair Labor Standards Act (“the FLSA”) – was scheduled to take effect December 1, 2016, but was placed on hold by a preliminary injunction issued by a Texas federal district court. New York State has now taken matters into its own hands independent of the now-suspended federal rule change.

On November 19, 2016, the New York State Department of Labor (“NYSDOL”) issued a notice of proposed Rule Making Activities to amend Parts 141, 142, 143 and 146 of 12 NYCRR– Minimum Wage Orders – in part to increase the statutory minimum salary level for the executive, administrative and managerial exempt employees (but not for professional employees). The current weekly exempt salary level in New York is $675 (or $35,100 calculated annually). The suspended federal DOL rule increases the FLSA minimum weekly level to $913 (or $47,476 calculated annually) from the current level of $455 weekly (or $23,660 calculated annually).

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New Jersey’s Legislature Attempts to Override Governor’s Objections to “Equal Pay” Bill

Posted in Discrimination

The sponsors of pay equity legislation passed by the New Jersey Senate and Assembly earlier this year have announced that the State Senate will attempt to override Governor Christie’s veto of the bill on December 19, 2016.

Senate Bill 992/Assembly Bill 2750 would amend the Law Against Discrimination (“LAD”) to promote gender pay equality. The New Jersey bill follows a trend of recently enacted state laws, in California, New York, Maryland, and Massachusetts, that aim to make it easier for plaintiffs to bring pay equity claims and subject employers to potentially greater damages.

The bill would make it an unlawful employment practice, under the LAD, to discriminate against employees on the basis of sex by compensating an employee of one sex at a lesser rate than an employee of the other sex for “substantially similar work.” The “substantially similar” standard, which diverges from the “equal work” standard of the federal Equal Pay Act, mirrors the California Fair Pay Act, which became effective in January 2016.
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Federal Court Preliminarily Enjoins DOL From Enforcing Overtime Exemption Rules

Posted in Wage & Hour

On November 22, 2016, in Nevada v. United States Department of Labor, et al., a judge in the United States District Court for the Eastern District of Texas issued a nationwide preliminary injunction enjoining the United States Department of Labor (“DOL”) from implementing and enforcing the Fair Labor Standards Act (“the FLSA”) final overtime rule that would otherwise become effective on December 1, 2016.

Brief Background
The final overtime rule, published on May 23, 2016, significantly increases the minimum salary threshold for the executive, administrative, and professional overtime exemptions (“the EAP exemptions”) under the FLSA from $455 per week ($23,660 annually) to $913 per week ($47,476 annually) and introduced other changes related to the new salary level discussed in detail in our earlier blog.

In response to the final overtime rule, the state of Nevada and 20 other states challenged the final rule by filing suit in the Eastern District of Texas on September 20, 2016 and moved for emergency preliminary injunctive relief on October 12, 2016. Over 50 business organizations also filed suit in the Eastern District of Texas to challenge the final rule, and the court consolidated the two actions on October 19, 2016.

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USDOL New Persuader Rule Permanently Enjoined

Posted in Labor

We are pleased to report that a federal court in Nat’l Fed’n of Indep. Bus. v. Perez issued a nationwide injunction permanently enjoining the United States Department of Labor’s new persuader rule last week. The decision is a major victory for the business community because the new rule placed employers’ abilities to freely seek labor counsel in jeopardy by expanding their obligations to publicly disclose arrangements into which they entered with the labor consultants, including their attorneys.

Persuader Rule
The “persuader rule,” which has been in place for over 50 years, generally requires employers and their labor consultants to disclose arrangements into which they enter to persuade employees regarding unionization. Significantly, the rule has an advice exemption that historically has protected these arrangements from disclosure provided that the labor consultants do not directly communicate with employees. Earlier this year, the USDOL issued a rule that effectively eliminated the advice exemption by requiring employers to disclose arrangements even if their consultants never make direct contact with their employees. The new rule led to a justifiable backlash from the business and legal communities. Critics of the rule saw it as a blatant attempt by the USDOL to discourage employers from retaining labor consultants and, in turn, facilitate union organizing drives particularly in light of recent pro-union actions by the National Labor Relations Board, including its new expedited union election rules.
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NYC Council Passes “Freelance Isn’t Free” Act

Posted in Wage & Hour

On October 27, 2016, The New York City Council unanimously passed a local law, the Freelance Isn’t Free Act, aimed to enhance protections for freelancers and purportedly to prevent wage theft. Under the law, freelancers include individuals (and organizations having no more than one person) retained as an independent contractor to provide services in exchange for payment. The law, however, excludes from coverage sales representatives (as defined in section 191 of the New York Labor Law), persons engaged in the practice of law under the contract at issue (and who are members in good standing of a bar and not under any restrictions with respect to the practice of law), and licensed medical professionals. The law does not apply to the United States government, New York City, and New York State (and their respective offices, departments, agencies, authorities, etc.) any local government, municipality, or county, along with any foreign government.

The law requires companies who retain the services of a freelancer, where the contract value is $800 or more (either standing alone, or when combined with other contracts between the parties over the prior 120 days), to enter into written contracts. Such contracts must include, at a minimum, the name and addresses of the hiring party and freelancer, an itemization of all services, the value of the services, the rate and method of compensation, and the payment date (or method for determining such a date). The law requires payment as specified under the terms of the contract, or if not specified, within 30 days after the services are completed.

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NJ Legislators Look to Prohibit Asking Applicants about Salary History

Posted in Discrimination, Employment Agreements

The New Jersey Legislature is poised to take up another thorny issue for employers, salary history. Described by legislative sponsors as an effort to promote pay equity, the legislation would amend the New Jersey Law Against Discrimination to bar employers from asking job applicants about their salary history, or relying on it to determine salary at any stage in the hiring process.

Two separate pieces of legislation have been introduced that prohibit an employer from inquiring about the salary history of an applicant. Assembly Bill 4119 was introduced on September 15, 2016 and referred to the Assembly Labor Committee. Senate Bill 2536 was introduced on September 15, 2016 and referred to the Senate Labor Committee.

New Jersey would be the second state to pass pay equity legislation prohibiting asking applicants about salary history. In August 2016, Massachusetts became the first state to pass such an Act. The Massachusetts Act banned employers from inquiring into an applicant’s salary history until “after any offer of employment with compensation has been made to the prospective employee.”

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Court Compels Arbitration of Lawsuit Filed by Employees Discharged After Discovery of Personal Text Messages About a Coworker on a Company-Issued iPad

Posted in Policies/Handbooks

A recent decision from the District of New Jersey granting a motion to compel arbitration not only reinforces the strong federal policy in favor of arbitration, but also highlights issues pertaining to company-issued devices and employees’ personal use of these devices.

While employed by Anheuser-Busch, Victor Nascimento received a company-issued iPad. Nascimento and other employees exchanged text messages about a coworker over their personal cell phones outside of the work day, but the messages were received on Nascimento’s company-issued iPad because the iTunes account on his iPad was linked to his personal cell phone. The company-issued iPad was later reassigned to the coworker who was the subject of the text messages, and that person discovered the text messages on the device and inferred that they were about him. Following an investigation by Anheuser-Busch, Nascimento and several other employees were fired. The terminated employees later sued Anheuser-Busch, alleging violations of the Law Against Discrimination.

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