Category Archives: legal issues

An End to Harassment Arbitration?

Does the “Ending Forced Arbitration of Sexual Harassment Act of 2017have a better chance of becoming law than past attempts to restrict arbitration agreements? Especially given the timing, some believe the answer is an unequivocal yes.

Rep. Cheri Bustos (center) announces a bipartisan bill last week.

As you may have heard, Rep. Cheri Bustos (D-Ill.) and Sen. Kirsten Gillibrand (D-N.Y.) introduced bipartisan legislation last Wednesday aimed at voiding forced arbitration agreements and enabling “survivors of sexual harassment or discrimination to seek justice.” Senate co-sponsors include Lindsey Graham (R-S.C.), Lisa Murkowski (R-Ark.), Kamala Harris (D-Calif.). House co-sponsors include Walter Jones (R-N.C.), Elise Stefanik (R-N.Y.), and Pramila Jayapal (D-Wash.)

In announcing the bill, Bustos said …

“If we truly want to end sexual harassment in the workplace, we need to eliminate the institutionalized protections that have allowed this unacceptable behavior to continue for too long. Whether it’s on factory floors, in office buildings or retail businesses, 60 million Americans have signed away their right to seek real justice and most don’t realize it until they try to get help. Our legislation is very straightforward and simple—if you have been subjected to sexual harassment or discrimination in the workplace, we think you—not the employer—should have the right to choose to go to court. While there are a lot of good companies that take sexual harassment seriously and work to prevent it, this legislation will help root out bad actors by preventing them from sweeping this problem under the rug.”

“No worker should have to put up with such an unfair system,” said Gillibrand.

On hand for the announcement was former Fox News’ host Gretchen Carlson, who sued her former employer and its then CEO Roger Ailes over harassment. (Ailes passed away in May.)

Carlson, who received a $20 million settlement in the case, described forced arbitration as a harasser’s best friend. “It keeps harassment complaints and settlements secret. It allows harassers to stay in their jobs, even as victims are pushed out or fired. It silences other victims who may have stepped forward if they’d known. It’s time we as a nation—together—in bipartisan fashion give a voice back to victims.”

Lawrence Lorber, senior counsel with Seyfarth Shaw in Washington, predicts that the bill, as its currently worded, will likely meet some opposition. Its chances, he adds, would be greatly improved were the wording more targeted to sexual assault and harassment.

“I think the language of the bill goes further than what they intended,” Lorber says. ”What it does is not only preclude arbitration from being applied to sexual-harassment matters, but [from] all contracts of employment.”

Lorber points out that there already exists a model for addressing the legislation’s shortcomings. Ironically, he says, it’s The Franken Amendment, which was part of the Defense Appropriations Act and prevents defense contractors from requiring arbitration in instances arising out of sexual assault and harassment. (Sen. Al Franken, D-Minn., who sponsored the amendment, announced last week he would soon be giving up his Senate seat as a result of accusations of sexual misconduct.)

Thanks to The Franken Amendment, Lorber says, there’s already a law that exists for addressing this issue, though “for a much more limited universe.”

Lorber says he wouldn’t be surprised to see a bill addressing this issue become law as soon as early next year.

HR’s Top Challenges for 2018

It’s been an eventful year, to say the least.

Mass shootings in Las Vegas, Sullivan Springs, Texas and elsewhere; a botched repeal of the Affordable Care Act and ongoing gridlock in the nation’s capital and, within the last two months, an almost daily drumbeat of sexual harassment allegations against leading figures in the entertainment, media and political realms — hardly any facet of American life was left undisturbed in an unusually eventful year in which it seemed abnormality in all things was “the new normal.”

A new survey from XpertHR  on the top 15 most challenging HR compliance issues for next year reveals that, unsurprisingly, current events are weighing heavily on the minds of HR leaders these days as they look ahead to 2018. Among their most pressing concerns is workplace violence: 45 percent of the 1,000 HR professionals surveyed identified preparing for, or responding to, an active shooter or workplace violence as very or extremely challenging. (In fact, concerns over deadly  workplace violence have given rise to new businesses dedicated to training and preparing employees for how to deal with an active shooter situation).

An emerging, patchwork crazy quilt of state and local regulations on marijuana legalization is also giving employers fits, with 35 percent of survey respondents feeling very or extremely challenged by managing employees who use marijuana medically or recreationally. Meanwhile, 32 percent cited addressing the impact of illicit substance abuse (such as heroin or opioids) in the workplace as very or extremely challenging.

“Just as with alcohol, it is lawful to prohibit an employee from bringing both lawful and unlawful drugs to work and use such substances on the job because of the risks drug use may have on the safety and productivity in the workplace,” says Beth Zoller, XpertHR’s legal editor. “Employers need to stay on top of federal, state and local developments as this is a rapidly evolving and changing issue.”

One of the headline-grabbing developments from earlier this year — the massive data breach that took place at Equifax — is illustrative of another top concern for HR going into 2018: protecting their organizations from cyber theft. Sixty four percent of respondents cited data security and the threat of a cyber breach as very or extremely challenging.

The legislative chaos in Washington is also extending into the workplace, particularly the uncertainty over healthcare reform, with 46 percent of respondents viewing the ACA as very or extremely challenging and 40 percent viewing ACA reporting as very or extremely challenging.

However, there’s an upside for employers now that a politically conservative presidential administration is in place, says Zoller.

“The appointment of Neil Gorsuch to the Supreme Court is sure to have an impact on labor and employment law cases and ensure a conservative majority in favor of employers and management-side issues,” she says. “The rollback of agency authority and more restrictive policies of the National Labor Relations Board and the EEOC will potentially have a positive impact on employers, who may be subject to less regulations.”

A Hot Issue Reaches The High Court

As lawyers prepared to argue before the U.S. Supreme Court today over the legality of mandatory arbitration clauses in employment contracts, a new study came out that underscores what’s at stake, estimating that more than 60 million workers are now covered by them.

The Economic Policy Institute, which says its mission is “to inform and empower individuals to seek solutions that ensure broadly shared prosperity and opportunity” carefully timed the release of results to come as before a widely-watched case reaches the high court.

The case is actually three cases involving different employers: Epic Systems Corp., a Wisconsin-based maker of software for health care systems and medical groups, Ernst &Young U.S. and Arkansas-based Murphy Oil USA Inc. All invoked arbitration clauses in disputes with individual workers over overtime and other issues.

The Supreme Court like will take months to decide the issue. And employers will be watching carefully.

To  gauge the potential impact of that ruling, the Economic Policy Institute surveyed 627 private employers with 50 workers or more nationwide, focusing questions on their nonunion workers. Author of the study was Alexander J.S. Colvin., a professor at Cornell University’s ILR School.

Based on this sample, researchers estimate 53.9 percent of private employers require workers to sign arbitration clauses. Researchers estimate 60.1 million U.S. workers are subject to mandatory arbitration with waiver of class-action rights. The practice appears to be more common in large businesses, the study said.

 

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A Tricky Legal Question for HR

The Aug. 11 march by white-supremacists in Charlottesville, Virginia, ended after a car plowed into a crowd of counter-demonstrators the next day, killing a 32-year-old woman.

Authorities have charged an Ohio man in the case, starting what could be years of legal repercussions.

For HR executives, the incident raises a legal question that is at least as complex: How can employers protect themselves when a worker participates in extremist political conduct that puts the business at risk?

That risk is painfully clear to the owners of two restaurants on opposite sides of the country. Both employed men who were publicly identified as participants in the Charlottesville rally. Both companies found themselves in the glare of unfavorable publicity as a result.

Boston-based Uno Pizzeria and Grill quickly fired a cook in a Burlington, Vermont outlet after he was identified in a news video and in social-media posts as a march participant and ardent white supremacist.

Owners of Top Dog, a small chain of hot-dog restaurants based in Berkeley, California, did not fire an employee who also was linked to the Charlottesville rally in social-media accounts. Instead, they told local news outlets, he chose to resign.

What about the First Amendment? Does it protect employees  from punishment by employers for exercising their constitutional right to free speech?

Not if they are employed in the private sector, lawyers say. The First Amendment only limits government control of a person’s speech or writing, writes employment attorney Robin Shea of Constangy, Brooks, Smith & Prophete LLP in Winston-Salem, North Carolina. “The First Amendment doesn’t prohibit limits on speech that are imposed by private individuals, or private-sector employers.”

State or local laws may apply in some cases, “but those jurisdictions are the exception, not the rule,” she writes.

Public employers take special care, Shea notes. And employers with a collective bargaining agreement should check to see if it limits their options, Shea writes.

In any case,“Employers must also be careful not to run afoul of the National Labor Relations Act by punishing employees who may be commenting about the terms and conditions of their employment,” writes Kimberly A. Ross, a partner with Ford Harrison in Chicago.

Ross recommends that employers tread carefully no matter what. “Because of all of the complex issues to be considered, employers are encouraged to consult with their employment counsel before making any significant decisions based on their employees’ off-duty conduct,” she writes.

Shea also urges employers to be cautious: “Never take action against any employee based on ‘politics’ unless you have consulted with counsel first,” she writes.

Is One Watchdog Better Than Two?

The Trump administration wants to combine the Equal Employment Opportunity Commission with another federal watchdog agency—and both worker and business groups are worried.

The issue got attention on Wednesday as new Secretary of Labor Alexander Acosta testified before a House subcommittee about how President Trump’s proposed budget will affect his department.

Among other proposals that would cut Labor department spending by 20 percent overall, Trump’s budget also proposes merging the department’s Office of Federal Contract Compliance Programs into the EEOC, an independent agency.

Acosta told skeptical Democrats on the panel that the merger made “common sense” and would not hurt workers, the Associated Press and other news organizations reported.

Off Capitol Hill, the merger idea has drawn fire from communities that often disagree—business leaders and worker-rights advocates. The Leadership Conference on Civil and Human Rights, a coalition that includes labor unions, the ACLU and others, wrote the administration and Congress on May 26 that the merger would effectively shutter the OFCCP by folding it into the EEOC.

“Both OFCCP and EEOC help advance and protect equal employment opportunity, but they are distinct in their enforcement approaches and expertise, and they should remain separate,” said Leadership Conference CEO Wade Henderson in a prepared statement. “We strongly urge Congress to reject this proposal, which would lead to an erosion of key civil-rights protections for working people.”

Though the merger idea got an early boost from the business-friendly Heritage Foundation, some corporate leaders agree with critics that the agencies should remain separate. Some, including the U.S. Chamber of Commerce, fear the merger would create a mega-regulator with too much power.

”There is a fear in the business community that this newly formed grouping might result in the worst of all worlds from both agencies,” said Randy Johnson, a chamber senior vice president, in a prepared statement. He noted that the EEOC has legal powers the OFCCP does not.

Ready for More Immigration Audits?

With tougher immigration rules on the front burner in Washington, nearly every employer should be prepared for a visit from ICE agents sooner or later, warns an immigration lawyer who defends employers.
With President Trump’s “Buy American, Hire American” policy increasing scrutiny of employer-sponsored work visas like the H-1B, “I do believe we’ll see increased enforcement with respect to audits and site visits,” says Montserrat Miller, a n employment attorney partner at Arnall Golden Gregory LLP in Washington who specializes in helping employers with immigration issues.

Immigration and Customs Enforcement agents aren’t just targeting packing houses and other businesses with a history of hiring undocumented workers, Miller says. And they’re no longer just looking for “criminal aliens” and gang members, common targets of ICE workplace enforcement operations under previous administrations.

Any business with workers who have “H” or “L “visas—commonly issued to let foreign citizens work in the U.S. for a sponsoring employer—should be prepared for a sudden visit by ICE agents looking to see that all the paperwork is in order, Miller says.

“Everybody has the potential to be detained if they’re not authorized to be in the United States,” she says. (Watch for more coverage of changes in immigration law, including a Human Resource Executive® magazine cover story to be published this month that looks at how employers are affected.)

Miller says it’s key to be prepared for these visits. First, she says, make sure people on the front lines, such as receptionists, know what to do when an agent arrives. They also should know what documentation ICE agents are required to present when they arrive, she adds, and whom to summon for help, including HR leaders and legal counsel.

Employers, Miller says, should also determine before any site visit where agents may and may not go to inspect company records.

Employees with work visas should be familiar with details provided on their visa applications “so they don’t accidentally say something [to agents] that raises questions” during a site visit, according to Miller.

The bottom line:”You need to have a plan in place.”

Biometrics and New Privacy Concerns

A recently filed class action suit in Illinois could be the signpost for “a new employment law frontier,” according to at least one law firm.

As recently reported by Holland & Knight, a class action suit pending in the U.S. District Court for the Northern District of Illinois centers around the state’s Biometric Information Privacy Act, which was passed in 2008 to prohibit the gathering and keeping of individuals’ biometric information without his or her prior notification and written permission.

In Baron v. Roundy’s Supermarkets Inc., et al., the plaintiff alleges that the supermarket chain violated BIPA by failing to meet the legal requirements to obtain and retain employee fingerprints the company used for timekeeping purposes.

Holland & Knight attorneys called biometrics an “emerging area” of employment law, as more employers begin to use the technology to log employees’ hours. Damages available under laws such as BIPA make this fertile ground for class actions as well. For each violation of BIPA, a prevailing party may recover the greater of actual damages or $1,000 for negligent violations of the Act, the attorneys note, adding that plaintiffs may recover the greater of actual damages or $5,000 for “reckless or intentional violations.”

With legislation comparable to BIPA already on the books in Texas, and states including Alaska, Montana, New Hampshire and Washington considering similar bills, employers would be wise to tread carefully when and if they introduce biometrics to their places of business.

“Laws like BIPA will become more relevant to employers and of increasing interest to the plaintiffs’ bar as the use of biometric data, such as the use of fingerprints or thumbprints for timekeeping purposes, becomes more prevalent in the workplace,” according to Holland & Knight.

“With the increasing awareness of such laws by the plaintiffs’ bar, it is important that employers using or considering the use of biometric data in the workplace ensure compliance with any state or local laws governing the use, retention and destruction of that data.”

A Paid Sick Days Law Dies (Again)

In case you missed it last week, the Pennsylvania Commonwealth Court upheld a 2015 trial court ruling that the City of Pittsburgh did not have the authority under state law to enact the Paid Sick Days Ordinance.

After the City of Pittsburgh passed the Paid Sick Days Ordinance, which would require employers to provide employees with a minimum of one hour of paid sick leave for every 35 hours an employee works in the city limits, a group that included the Pennsylvania Restaurant & Lodging Association and several local restaurants and businesses challenged the city’s authority to enact such legislation, according to a press release from Littler.

The challenge was based on the fact that under the laws of the Commonwealth of Pennsylvania, Pittsburgh is a home rule charter municipality.

Under state law, “a municipality which adopts a home rule charter shall not determine duties, responsibilities or requirements placed upon businesses, occupations and employers      . . .  except as expressly provided by the statutes which are applicable in every part of this Commonwealth or which are applicable to all municipalities or to a class or classes of municipalities.”

Citing an earlier Pennsylvania Supreme Court ruling and its own precedent, the Commonwealth Court found that the Paid Sick Days Ordinance imposed “numerous affirmative duties” on employers and therefore was invalid and unenforceable.

The City of Pittsburgh had argued that state law permits cities to pass ordinances relating to disease prevention and control, but the Commonwealth Court noted that the provision of state law that the city relied upon applies only to municipalities that have boards of health or a department of health.  Pittsburgh has neither.

It is unclear whether the City will appeal.  While Pittsburgh’s ordinance has been invalidated, employers should remember that Philadelphia’s paid sick leave ordinance remains in effect, Littler notes.

HR lessons from Trump’s FBI Firing

Some employment lawyers couldn’t help themselves last week after President Trump fired FBI director James Comey in a political incident that quickly spun out of control: They found lessons for their corporate clients from the high-profile inside-the-Beltway affair.

“I wanted to go on CNN or MSNBC,there was so much to say,” laughed Ellen R. Storch, a partner with Kaufman Dolowich Voluck LLP in Woodbury, N.Y.

The comparison to corporate HR is plausible, Storch notes, since any large company may have regional or divisional leaders whom the CEO might target for”showboating,” to use the president’s term about Comey.

But any CEO who fired a high-profile subordinate as Trump fired Comey would be exposing the company to legal risks, says Storch, whose practice includes both litigation and counseling employers on best practices.

“After doing this for 20 years, II firmly believe the optics” of a termination are critical,Storch says — is there a clearly legitimate  business reason for termination? The tone and content of public messages about the firing also matters, Storch says.To start with, a high-profile employee likely has a big ego that must be managed, she says. If they are considering legal action over their termination, that employeewill be balancing pragmatic considerations — possible harm to their career for battling an employer in court — with anger stemming from damage to that big ego. So how an employer handles the termination can  influence the employee’s willingness to sue, Storch says.

How a firing plays out also will affect employees who remain and how they feel about their employer, she notes. Much of this depends on what leaders say about the termination, Storch says. “You can manage a separation in a way so it sends a message.”

Ideally that message is “We care about you guys, but we need to go in a different direction.”So wWhat was wrong with how Comey’s firing was handled?

“Just about everything,”Storch says. A corporate employer who issued as many conflicting statements as did the White House in the hours after Comey was fired would have undercut its legal defenses, Storch says. In such a situation, “the employer has unnecessarily created a credibility issue for themselves,” she says.

 

 
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Employers Take Care — It’s May Day

Today is May Day, a.k.a. International Workers Day, an occasion that in the United States once was mainly observed by labor unions. In 2017, reflecting the rise of more informal worker  organizations, civil-rights groups with names like “Rise Up” are behind hundreds of planned strikes, rallies and marches demonstrations around the country in support of labor-related causes like higher minimum wages and relaxed federal immigration policies.

 

Welcome to the future, saysAndrew B. Prescott, an employer-side labor lawyer with Nixon Peabody in Providence, Rhode Island. With Donld J. Trump firmly installed in the White House, Prescott sees the beginning of an era of more  antagonistic relations between employers and worker groups. And political groups dedicated to causes like fast-food-worker rights, not traditional labor unions, will likely set the tone, Prescott says.

Though May 1 demonstrations may be organized by groups not involved in collective bargaining, lawyers warn employers that today’s activities may still be protected under the National Labor Relations Act.

Writing in Crain’s Detroit Business, employment attorney Nick Huguelet ofDetroit-based Nemeth Law PC notes that the law doesn’t give workers the right to simply skip work on a day like today. But section 7 of the NLRA “protects an employee’s right to engage in concerted activities concerning the terms and conditions of employment or for other mutual aid or protection…this right applies equally in both union and nonunion workplaces and may protect employees from being disciplined for engaging in a strike.”

Though the law”does not protect purely political demonstrations, it can be difficult to show that a job action is purely political,” Huguelet writes. “For example, immigration reform has been found to be sufficiently connected to the terms and conditions of employment, and therefore protected. Because the NLRB for the time being continues to be sympathetic to employee rights, employers should be cautious about imposing disciplinary action on striking employees.”