Category Archives: legislative

Breaking Down the Latest EO

Just a few days ago, my colleague, Michael O’Brien, posted an item on a letter written by the HR Policy Association, and sent to U.S. Department of Labor 490613709Secretary Thomas Perez, that expressed HRPA’s concern over President Obama’s use of executive orders. Well, it didn’t take long for the administration to respond yesterday with one more EO, this one requiring federal contractors to disclose their labor-law violations during the past three years.

The president’s latest such order, named Fair Pay and Safe Workplaces, states …

For procurement contracts for goods and services, including construction, where the estimated value of the supplies acquired and services required exceeds $500,000, each agency shall ensure that provisions in solicitations require that the offeror represent, to the best of the offeror’s knowledge and belief, whether there has been any administrative merits determination, arbitral award or decision, or civil judgment, as defined in guidance issued by the Department of Labor, rendered against the offeror within the preceding 3-year period for violations of any of the following labor laws and Executive Orders … .”

According a White House Fact Sheet, the EO will “ensure that the worst actors, who repeatedly violate the rights of their workers and put them in danger, don’t get contracts and thus can’t delay important projects and waste taxpayer money.”

Federal agencies, the Fact Sheet states, will require prospective contractors to disclose labor-law violations involving 14 covered federal statutes and equivalent state laws, including those addressing wage and hour, safety and health, collective bargaining, family and medical leave, and civil-rights protections.  Agencies will also require contractors to collect similar information from many of their subcontractors.

“Contracting officers will take into account only the most egregious violations, and each agency will designate a senior official as a Labor Compliance Advisor to provide consistent guidance on whether contractors’ actions rise to the level of a lack of integrity or business ethics,” the Fact Sheet explains.

The White House reports that the “vast majority of federal contractors have clean records.” But it also references a 2010 Government Accountability Office report that found almost two-thirds of the 50 largest wage-and-hour violations and almost 40 percent of the 50 largest workplace health-and-safety penalties issued between FY 2005 and FY 2009 were at companies that went on to receive new government contracts.

In case you’re wondering, the Department of Labor estimates that there are roughly 24,000 businesses with federal contracts, employing about 28 million workers.

Other provisions in the EO include requiring contractors to “give their employees information concerning their hours worked, overtime hours, pay and any additions to or deductions made from their pay, so workers can be sure they’re getting paid what they’re owed” as well as directing the General Services Administration to develop a single website for contractors to meet their reporting requirements—for this order and for other contractor reporting.”

Mickey Silberman, a managing shareholder in Jackson Lewis’ Denver office, wrote in a blog post yesterday that the EO’s provisions don’t come as a huge surprise, with one exception—a section prohibiting contractors and subcontractors from requiring that new employees enter into pre-dispute mandatory arbitration agreements. “Many employers require employees to sign arbitration agreements at the outset of employment,” he writes. “This provision of the EO is a ‘game changer’ that government contractors and subcontractors must review and determine how to respond.”

It is possible, Silberman continues, that employers “will bring litigation challenging this provision of the EO.”

Littler Shareholder Michael J. Lotito, co-chair of Littler’s Workplace Policy Institute, shared with me similar sentiments. Government contractors are easy targets for more and more regulation, Lotito said. “The EO process engaging in these types of rules and regulations has been challenged on different grounds and will most certainly be again over the next several months. Even assuming the intent is sincere behind the proposals, they are subject to such abuse.”

Lotito added that “one always has to wonder how much of this is about politics and generating interest in the base between now and November.”

Guess we’ll have to wait to see if Silberman and Lotito’s predictions eventually come to pass. But there’s at least one thing we do know for sure—the Obama administration is showing no signs of letting up on its efforts to issue EOs targeted at the workplace.

 

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A Setback for Anti-Bullying Efforts?

bullyEarlier this month, HRE Editor David Shadovitz reported on Tennessee Gov. Bill Haslam’s signing of the Healthy Workplace Act, which made the Volunteer State the first in the Union to pass legislation aimed at putting an end to on-the-job bullying.

In that piece, Shadovitz pointed out that 28 states have introduced anti-bullying legislation this year. Experts, he said, predict other states will soon take similar measures, adding that New York and Massachusetts appear the most likely to pass anti-bullying laws applying to private-sector employers. (The Tennessee law only affects the practices of state and local government agencies.)

While some states may soon follow in Tennessee’s footsteps, it seems that New Hampshire took a step in the opposite direction this week.

On Monday, Gov. Maggie Hassan vetoed a bill geared toward protecting New Hampshire state employees from abusive work environments, saying the bill was “well-intentioned but unworkable,” according to the Concord Monitor.

The measure—which state lawmakers passed after current and former state workers said they had experienced bullying behavior at work—would have required state departments and agencies to develop policies to address harassment, the Monitor reports.

Hassan, however, found the legislation’s definition of abusive conduct to be overly broad, which she says could make even routine employee interactions potential causes of action. The bill “also attempts to legislate politeness, manners and the interpersonal relationships of co-workers,” she said, contending the law would lead to a significant spike in lawsuits and subsequently hamper productivity.

Conversely, bill sponsor Rep. Diane Schuett feels a failure to put anti-bullying laws in place yields roughly the same end result, with respect to employee output.

“[Bullying] undermines the efficiency within state government if you end up with one or two employees being harassed on the job, either by another employee or a supervisor, and you end up with the entire agency being aware of it and feeling like they have to pick sides.”

There might well be some truth in both of those statements. Maybe the silver lining in the New Hampshire scenario is that the bill—which state lawmakers could revive by overriding the Governor’s veto—is at least on the table, with each side acknowledging that workplace bullying is a real and pervasive problem that must be addressed in some way, even if the legislation’s workability may be at issue.

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Streamlining the Workforce Development System

You can mark July 9 down in your books: Lawmakers from both parties in Washington found something they could agree on!

496666235In case you missed it, Congress passed on Wednesday the Workforce Investment and Opportunity Act, which revamps the nation’s workplace development program. The bill passed in the House by an overwhelming margin, 415 to 6, and is now on its way to President Obama, who is expected to sign it. (It passed in the Senate on June 25 by a 95 to 3 vote.)

­­­­­­­­­­­­­­­­­­­­­­­­­U.S. Secretary of Labor Thomas E. Perez issued the following statement regarding the passage …

Democrats and Republicans have come together on a bill that is good for workers, employers and the economy as a whole. It will help more people succeed in 21st century jobs and punch their ticket to the middle class. And it will help businesses hire the world-class, highly-skilled workforce required to compete successfully in the global economy.

“WIOA improves the workforce system, aligning it with regional economies and strengthening the network of about 2,500 American Job Centers, to deliver more comprehensive services to workers, job seekers and employers. The bill will build closer ties among key workforce partners—business leaders, workforce boards, labor unions, community colleges and non-profits, and state and local officials—as we strive for a more job-driven approach to training and skills development.”

As we reported in a June 30 story posted on HREOnline.com, the law aims to streamline the workforce development system by:

  •  Eliminating 15 existing programs.
  •  Applying a single set of outcome metrics to every federal workforce program under the Act.
  •  Creating smaller, nimbler and more strategic state and local workforce development boards.
  •  Integrating intake, case management and reporting systems while strengthening evaluations.
  •  Eliminating the “sequence of services” and allowing local areas to better meet the unique needs of individuals.

The legislation—a compromise between the SKILLS Act (which passed in the House last year) and the Workforce Investment Act of 2013—was endorsed by the Chamber of Commerce, which cited as positives the bill’s focus on “the continued leadership role of business, the clear language that promotes alignment of investments in education and training, and the increasing focus on outcomes.”

Of course, now the hard part begins. As James J. Parks, an attorney with Jaffe Raitt Heuer & Weiss, noted in our June 30 piece, “The problem you always have when you change anything in the government is the bureaucracy. Bureaucracy is a self-sustaining animal.”

But that said, there’s no denying that any effort to streamline the nation’s workforce programs and remove some of the much-dreaded inherent red tape should be viewed by the HR community as a good thing.

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Unemployment: Good News and Bad News

unemploymentThe jobs report for June, released today by the Labor Dept., has some welcome good news: Employers added 288,000 jobs last month, which is well above the rate of hiring recorded during the first five months of this year. The unemployment rate has ticked down to 6.1 percent, according to the DOL, which is the lowest it’s been since 2008, when the financial crisis hit.

This good news does not, of course, mean that we’ve finally left the economic doldrums behind. Two thirds of the jobs created in June were part-time, the DOL reports, and no doubt many of the employees who took those jobs would rather be employed full-time. As for the unemployment rate, that doesn’t include people who’ve simply given up looking for work. If these people were included in the official unemployment rate, it would actually be 9.6 percent instead of 6.1 percent, according to the Economic Policy Institute.

More distressing still (apologies for being such a gloom-meister right before the national holiday) is a new study from the Boston Consulting Group, which projects that the U.S. will be one of the few economies that is projected to struggle with high unemployment through 2030. It is expected to have a “worker surplus” equal to between 10 percent and 13 percent of its labor force in 2020 (between 17 million and 22 million people) and of 4 percent to 11 percent in 2030. The U.S. must “find ways to better utilize its workforce or it will continue to face relatively high unemployment,” according to the BCG report. “Improvements in training and education, as well as incentives for individuals and businesses to produce workers with the necessary skills and education, are needed to counteract this trend.”

This is one area where our do-nothing Congress (which currently has a sky-high approval rating of 16 percent) might actually do something: As Kecia Bal reported this Monday on HREOnline, the Workforce Innovation and Opportunity Act would reauthorize and amend the Workforce Investment Act with the intention of making it easier for states and local communities to match unemployed workers with the skills and training needed by today’s companies. As we’ve learned the hard way, there’s no magic wand that will solve our current unemployment problem, but maybe if we make better use of our existing resources so that jobs requiring specialized skills no longer go begging even as so many Americans have gotten too discouraged to look for work, we can at least make some serious progress.

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Employers Missing ADA Coverage in FMLA Cases

Employers are missing half of Family and Medical Leave Act cases involving employees’ serious illnesses that should also have been reviewed for Americans with Disabilities Act eligibility.

462011275 - disability and gavelThis according to Chicago-based ComPsych, in this report issued last week, June 24 to be exact, titled The Risk of Non-Compliance With ADA. The report breaks down by certain industries the percentage of FMLA cases that need ADA review, yet are being missed.

They include: retail at 13.2 percent, health services at 10.9 percent, manufacturing at 6.8 percent, public administration at 6.7 percent, trades at 6.5 percent and professional services at 5.9 percent.

These numbers, says Matt Morris, a vice president and licensed attorney at ComPsych, are “significant.”

“A common mistake employers make,” he says, “is to deem an FMLA leave request as ineligible, then not review it for ADA purposes.”

The potential consequences of such oversight “can be severe,” says Morris, “since one ADA misstep can lead to an investigation of the employer’s entire leave practices.” Hence the rash of recent ADA class-action lawsuits by the Equal Employment Opportunity Commission, he adds.

Indeed, the EEOC is coming off a record 2013 in terms of ADA penalties paid out by employers, a whopping $109.2 mill. Here are just three of the most sizable payments: $6.2 million by Sears Holding Co. involving 235 plaintiffs, $3.2 million by SuperValu involving 110 plaintiffs and $20 million by Verizon.

I asked Morris for a good example of an ineligible FMLA leave that would be covered under the ADA. Here’s what he said:

An employee has been at the company for six months and breaks his leg. He needs time off for rehab and to recoup, but is denied FMLA leave because he hasn’t been employed long enough. In this case, the employer should still review for ADA accommodation.”

Basically any ineligible FMLA leave for the employee’s own health condition (obviously not for baby bonding, etc.) has the potential to be an ADA leave, he tells me. “Although a ‘serious health condition’ under the FMLA and a ‘disability’ under the ADA are both two different standards, they are each very likely applicable to a health condition that forces someone to be out of work,” says Morris. And while the FMLA requires an employee to have been employed for 12 months and worked 1,250 hours in the last 12 months in order to be eligible, the ADA has no such standard. So, an ineligible FMLA employee still may have an ADA disability.

Perhaps the most common ADA misstep is waiting for an employee to “raise her hand” to request an ADA accommodation specifically or by name, Morris says. Courts have been clear that the “notice requirements under the ADA are nearly identical to those under the FMLA,” he says, but employers often don’t recognize that requests for FMLA leave are “hidden” requests for an accommodation — i.e., leave — under the ADA.

Interestingly, he tells me, employers all share a common misstep, which is that the company created and tried to enforce a standard policy — strange, in part, because generally this is exactly what HR tries to do: create uniformity and equality.

“But … they don’t consider whether the leave should be continued on a case-by-case basis,” says Morris. Maybe the more important thing is to note how easily one mistake can turn into something broader. What can happen — and, in fact, has been the way most of these cases start, he says — is:

1) The employee has an adverse action taken against her (usually, she’s fired).

2) She files a charge of discrimination with the EEOC (such charges are free to file, don’t require a lawyer, and often list several bases on which the employee believes she was discriminated against – for instance, race, sex, religion and then disability).

3) If the EEOC determines that, in that one case, the disability policy had a uniform cutoff — what it calls an ‘inflexible’ policy — it then uses its subpoena power to request the names of all employees who were subject to that policy (fired because they crossed that inflexible line).

4) The EEOC then sues on behalf of all, or most, employees subject to the policy and suddenly there are hundreds of plaintiffs.”

Thus far, this has only arisen because the policy was clear (“if you take more than X amount of time on leave, your job will not be protected”), but even if employers are detecting the right employees [for FMLA leave], they still have to have the expertise to apply such ADA standards as “reasonable accommodation,” “undue hardship” and “significant limitations (of a major life function)” appropriately.

So what should you be keeping top-of-mind? Here’s Morris’ caution:

Employers have been pining for three to four years for additional guidance from the EEOC on how to conduct the interactive process (how to determine a ‘reasonable’ amount of time, etc.). Chances are, given indications from the EEOC itself, the guidance will not come soon. Until then, employers will still be held responsible for appropriately applying these vague standards to a host of factors (e.g., What does the employee do? Could others help? Are there other jobs she could do? How long will the disability last? Are there things [you] can do to help reduce the time?)”

Hope this is helpful.

 

 

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Still Time to Chime in on NLRB’s Email Decision

99274052--gavel and hourglassYou still have time to offer input into a National Labor Relations Board decision that bars employees from using their employer’s email for union-organizing purposes, according to this notice from the Society for Human Resource Management.

The NLRB invited briefs back on April 30 pertaining to its interest in reconsidering its decision in the Register Guard case. Even if you missed it, you have until June 16 to submit your position in writing.

For background, here is an earlier synopsis of the initial ruling from Littler and here, from the National Legal and Policy Center, via the Before It’s News website, is an even-more-detailed one, with history and background on other cases that impact this one. It notes that, in 2007 …

… by a 3-2 margin along party lines [with the three Republicans forming the majority], the NLRB concluded that a Eugene-Ore.-based newspaper, The Register Guard, owned by Guard Publishing Co., was within its rights in stipulating that its e-mail and other employee-communications systems ‘are not to be used to proselytize for commercial ventures, religious or political causes, outside organizations, or other non-job-related solicitations.’ Management, concluded the board, had the authority to apply that rule to an affiliate of the Communications Workers of America to which a number of newsroom employees belonged. The majority opinion held [that]: ‘[E]mployees have no statutory right to use the[ir] employer’s e-mail system for Section 7 purposes.” The ruling, however, wasn’t a complete victory for the employer. It held that Guard Publishing’s disciplinary action against an employee-CWA representative was unlawful to the extent that it punished that person’s purely informative [as opposed to advocacy] use of company e-mail. The board remanded the case to a District of Columbia circuit court, which upheld the ruling [Guard Publishing v. NLRB, 571 F.3d 53 -- D.C. Cir. 2009].”

Not surprisingly, there are politics involved, according to the NLPC:

Its partial victory notwithstanding, organized labor has been smarting over Register Guard these last several years. All the more frustrating, from their standpoint, is the fact that the ruling was handed down on the last day in office of then-NLRB Chairman Robert Battista, a Republican. With a 3-2 Democratic majority since last summer — after more than a half-decade of operating short-handed – plus the guidance of pro-union current General Counsel Richard Griffin, a reversal is now within their grasp.”

If the NLRB reverses its decision, “which is likely given its current 3-2 pro-union majority,” the NLPC says, “it would be handing unions a potent organizing tool, and more broadly, restricting employer property rights.”

If you’re really in an amicus-brief-submitting frame of mind, here is another invitation to submit briefs to the NLRB. In this case, the board is inviting briefs “to afford the parties and interested amici the opportunity to address [its] joint-employer standard, as raised in Browning-Ferris Industries (Case 32-RC-109684).

Among the issues raised by the NLRB in this one is whether the parties and amici believe the NLRB should adhere to its existing joint-employer standard or adopt a new standard. Those briefs are due on or before June 26.

 

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More Restrictions on Criminal-Background Checks

California appears to be the latest state to join the criminal-background-restriction bandwagon. A new law enacted last month amends the California Labor Code to prohibit public and private employers from asking job applicants about criminal records that have been expunged, sealed or dismissed.

gavel and handcuffs -- 162424875“The good news is that [the law] doesn’t break entirely new ground, but instead modifies existing law,” says Brian Inamine, a LeClairRyan labor and employment attorney and shareholder in the firm’s Los Angeles office, in this release about it. “The bad news is that it represents one more hurdle that businesses have to contend with.”

Indeed, as my Nov. 13 news analysis on HREOnline points out, the hurdles are racking up. To date, 43 cities, counties and municipalities, and 10 states have passed “ban the box” legislation for public-only or public and private employers, making questions about criminal convictions on job applications illegal.

What’s more, as that story points out, there’s still a lot of confusion about what’s required of employers under the U.S. Equal Employment Opportunity Commission’s guidelines on criminal-background checks.

Actually, as it says, nothing’s really required. There’s no federal law being dictated in the guidelines, but failing to follow them could lead employers to discrimination charges under Title VII of the 1964 Civil Rights Act, which the guidelines are based on. The EEOC maintains criminal-history checks disproportionately impact minority candidates. For a rundown of some of the events and issues leading up to the EEOC’s guidelines, take a trip here through some of our earlier blog posts.

Another recent news analysis of mine looks at an additional potential punishment, under the Fair Credit Reporting Act, that Disney recently found itself ensnared in. In a class-action lawsuit, Culberson vs. The Walt Disney Company, Robert L. Culberson claims Disney illegally barred him from employment by failing to provide him with the proper adverse-action notice — required by the FCRA when an adverse-employment decision is based on any portion of a background check.

In that case, Culberson’s background check showed a criminal conviction on a battery charge from 1998 — when he was 19 years old — that had been expunged from his record in 2010. He claims he was not given the opportunity to correct the information before the company decided not to hire him, nor did Disney re-evaluate his application after the background-screening company, Sterling Infosystems Inc., eventually removed the conviction from his record and issued a new report.

As the new California law reminds us, and as the sources in all these linked stories and posts underscore, make sure you know what criminal-background laws govern the jurisdiction(s) you’re in and — equally important — what other laws might come in to play should you fail to follow proper procedures.

 

 

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Broadening Definitions Under the ADA

In case you missed it, employers were recently given further insight as to what qualifies these days as a disability under the ADA Amendments Act of 2008.

On Jan. 23, the Fourth Circuit Court of Appeals ruled that, as long as a temporary impairment is sufficiently severe, it would qualify as a disability, reversing a district court decision regarding a wrongful-discharge claim.

200249331-001The case involved Carl Summers, who, as a senior analyst for Altarum Institute, fell and injured himself while exiting a commuter train. Summers, who underwent leg surgery and was told by doctors he might not be able to walk normally for at least seven months, was provided with short-term-disability benefits. He suggested that he start working part-time from home and gradually return to full-time work, but representatives from Altarum failed to follow up on Summer’s return-to-work plan or suggest any alternative reasonable accommodation. The firm eventually terminated him, installing another analyst in his position.

In Sept. 2012, Summers filed a complaint under the ADA, alleging he was wrongfully terminated because of his disability.

In its ruling, the Fourth Circuit said “an impairment is not categorically excluded from being a disability simply because it is temporary” and that Summer’s alleged impairment “falls under the amended Act’s expanded definition of disability.”

I asked Paul Mollica, of council with Outten & Golden LLP in Chicago, for his thoughts on what the decision—which many believe could be the first ruling of its kind under the ADAAA—means for employers.

Going forward, he told me, employers are going to need to accept that the “lessons learned up to this point aren’t true anymore” and “retool” accordingly.

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A Workplace-Centric SOTU

President ObamaFrom the employer’s and HR leader’s perspectives, there were plenty of reasons to tune in to last night’s State of the Union Address—from minimum-wage issues and gender-pay equality to the announcement of a new savings bond designed to help working Americans start their own retirement savings.

For example, President Barack Obama announced an executive order that will require all federal contractors to raise their minimum wage to $10.10 per hour. He urged private employers to take similar action, pointing to organizations such as Costco as examples of large companies that had taken the initiative to raise pay rates to more than $10 an hour on their own.

President Obama also advocated the enactment of legislation that would increase the federal minimum wage to $10.10 per hour. “I am going to call this the 1010 Act,” he said, and urged Congress to pass the bill in 2014. “Let’s give America a raise,” added the president, to rousing applause.

While “the scope of the [aforementioned] executive order is unclear,” we should expect to see movement on the minimum-wage front in the days and months to come, even if it occurs first at the state level, says Connie Bertram, a Washington-based partner in the labor and employment department at Proskauer.

“I do think we’re going to see increases [in minimum wage] at the state level,” says Bertram, who is also head of the firm’s D.C. labor employment practice and co-head of Proskauer’s whistleblowing and retaliation, and government regulatory compliance and relations groups. “I doubt we’ll see across-the-board federal increases in the near future. But very often, when the federal government can’t take action, the states step in.”

Increasing pay rates and job opportunities was a recurring theme on Tuesday night, as President Obama announced a White House initiative geared at aiding the unemployed, and later this week will meet with a group of CEOs and business leaders in an effort to open up more opportunities for the long-term unemployed. And, as HRE Senior Editor Andrew R. McIlvaine writes today, the president also shared plans for improving the nation’s economy by connecting out-of-work individuals with skills-starved employers and strengthening the manufacturing sector.

Obama called on Congress to take action on other fronts as well, reiterating his call for passage of the Paycheck Fairness Act, which would strengthen the Equal Pay Act.

“As President Obama said, it’s time to leave ‘Mad Men’ attitudes and policies behind and adopt programs that allow people to hold jobs and care for their families,” said Debra L. Ness, president of the National Partnership for Women & Families, in a statement.

“We need Congress to advance the Paycheck Fairness Act, to finally reduce the punitive wage gap,” said Ness, adding that “we need a higher minimum wage, unemployment benefits we can count on and a real chance at retirement security.”

Indeed, retirement saving was on President Obama’s radar as well, as he offered details of a new retirement savings account—”myRA”—that he hopes will aid American workers in saving adequately for retirement.

“It’s a new savings bond that encourages folks to build a nest egg,” said President Obama. “MyRA guarantees a decent return with no risk of losing what you put in.”

The accounts, he explained, would be geared toward workers whose employers don’t offer traditional retirement accounts such as 401(k)s, and would essentially function like a Roth IRA, with government backing akin to that of a savings bond. As such, the balance of a myRA account could not go down, he said, with the investments having principal protection.

An initial pilot program will include companies that agree to enroll by the end of 2014, and workers making less than $191,000 annually will be able to invest, added President Obama.

The essential concept behind myRA accounts “has been around for a while,” says Lynn Dudley, senior vice president of retirement and international benefits policy with the Washington-based American Benefits Council, who likens the new myRA bond to R-bonds.

While more details on myRAs have yet to emerge, the accounts may prove to be an attractive option for many employers, especially those with large numbers of part-time or temporary workers, or employees who are in and out of the workforce, says Dudley.

“If a large employer is already offering a retirement plan, [it's] not going to eliminate that plan and send everyone to an [myRA] bond. [It's] going to keep [its] plan,” she says. “This is really targeted to people who aren’t already participating, or aren’t eligible to participate. It’s a select population, but it’s a growing one.

“And [such an account] is relatively easy to open up and offer through an employer,” adds Dudley. “It’s easy for HR to administer, and it’s portable for workers. The one drawback is that it’s an investment with a guaranteed rate of return, so it’s a conservative investment. But it’s a good idea.”

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Whistleblower Protections Keep Expanding

whistleTwo weeks from today, a bill will take effect that expands protection for whistleblowing employees in California. While only applicable to companies operating in the Golden State, one new wrinkle in the legislation should perk up the ears of employers everywhere.

On Jan. 1, 2014, California’s Senate Bill 496 will increase whistleblower protections for employees who have made internal reports alleging illegal behavior internally to a person with authority over the employee or to another employee with the authority to investigate, discover or correct the reported violation.

Interestingly, the law also subjects employers to liability for “anticipatory retaliation,” meaning companies can be held accountable for retaliating against an employee based on the mere belief that he or she might be a whistleblower.

Kenneth Sulzer, co-head of the California labor and employment law group with international law firm Proskauer, offers up an example.

“Say you have an employee who prepares an expense report for their manager, and that employee suspects the expenses were fudged a bit. That employee asks some questions, and is later fired for something else,” explains Sulzer. “But that employee has emails including those questions, and believes the supervisor anticipated he or she was going to make a complaint. Those emails record that the employee asked the questions, and, legally speaking, the employee has a factual leg to stand on.”

Again, such a claim could only be made in California at this point, and whether other states pursue similar legislation remains to be seen. But the enactment of the California bill signals the latest state-level move to provide a wider safety net for whistleblowers, and employers throughout the U.S. should take note, says Sulzer.

“We expect to see a substantial expansion in whistleblower protections in states around the country,” says Sulzer. “Driving this trend are several high-profile cases that have stoked the interest of the plaintiff’s bar, feeding on the public’s distrust of institutions, disparity of income and federal legislation such as the False Claims Act, Sarbanes-Oxley and Dodd-Frank, and the SEC whistleblower bounties.”

Provisions that leave employers potentially liable for “anticipatory retaliation,” however, could be “more problematic for employers than many other whistleblower protection laws,” says Sulzer, “as it provides a cause of action where an employee does not actually engage in whistleblowing, but is merely expected to do so, and provides a cause of action even where the employee’s job is to point out flaws and review quality of work.”

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