House Republicans Just Voted to Change Overtime Rules for Workers

The U.S. House of Representatives voted to pass a bill that Republicans have promoted since the Newt Gingrich era, one that would allow private-sector employees to exchange overtime pay for “compensatory time” off, electing to accrue extra hours off rather than extra pay in their wallets, The Washington Post reports. The bill passed 229 to 197, largely along party lines.

“Under the proposed changes, eligible employees — if their employer decides to offer the option — would be able to voluntarily choose to receive comp time they can bank and use at a future date in lieu of immediate overtime pay in their paychecks,” reporter . “If they change their minds and want the pay after all, employees would have the option of ‘cashing out,’ with the employer required to pay the overtime within 30 days.

Some opponents of the legislation say they worry that employers will feel pressured to choose comp time.

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Fox News Scandal Puts General Counsel in the Crosshairs

The top lawyer at Fox News finds herself the subject of speculation about whether she may be following the company’s former president out the door in the wake of complaints of sexual harassment or racial discrimination at the network.

Financial Times reports that Dianne Brandi, executive vice president of legal and business affairs, is named in three lawsuits that the network is contesting.

In one of the suits, Andrea Tantaros, a Fox News host, filed a suit against the company and Brandi, alleging that Brandi failed to investigate allegations of misconduct. Fox News and Brandi have denied the allegations in all the suits.

The Washington Post reports that Brandi was one of the senior executives “who engaged in a concerted effort to silence Tantaros by threats, humiliation, and retaliation.”

Hollywood Reporter has a story saying that Brandi is particularly vulnerable if more heads roll at Fox News.

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BigLaw Headhunter’s Sexist Rant Leads to Apology, Leave of Absence

Apology - sorryHarrison Barnes, managing director at BCG Attorney Search, recently posted an article advising law job applicants how to deal with not hearing back after an interview.

But, as Joe Patrice of Above the Law explains, Barnes somehow managed to describe “most legal recruiters” as women who “are quite attractive and fit,” as well as “a little ditzy and [who do] not have the other sorts of qualifications that would make them qualified for the job.”

The passages, now deleted from the company’s website, continued:

“Not only do they sometimes have more beauty and fewer brains, but they also may have more beauty and less interest in people, less ability to connect with people, and similar negative characteristics. This means they expect people to treat them as if they are special and sometimes are more focused on themselves than their jobs.

“It is not uncommon for recruiting coordinators to use their workspaces as a hunting ground for mates—and it works.”

After the inevitable uproar, Barnes announced that he was sorry and would be taking an extended leave of absence from BCG Attorney Search.

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Restrictive Covenants Can Swing Both Ways: A 3-Step Plan To Avoiding Legal Risks When Onboarding New Employees

Employment contractEmployers have been using restrictive covenant agreements – contracts that contain non-compete, customer non-solicitation, employee non-solicitation, or non-disclosure of confidential information – with increasing frequency in recent times, writes Michael Elkon with Fisher Phillips.

“Increased media attention on the practice of forcing lower-level employees to sign non-compete covenants, combined with the widely publicized report on non-compete restrictions issued by the Obama White House in its waning days, has led to an increase in the number of reported cases. Further, several states are passing new laws or considering changes to existing laws on the subject,” he explains.

He describes three basic steps a company can take to reduce the chances of a lawsuit from a competitor, or at least put the company in a favorable position if litigation is threatened.

These include “Ask questions on the front end,” “Structure the job on the front end to ensure compliance,” and “Emphasize the importance of purging all former employer materials.”

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Bad Judgment on Social Media May Lead to Job Offer Withdrawals

Social mediaPlano, Texas attorney Jason Van Dyke was all set to begin a new chapter of his legal career as an assistant district attorney in Victoria County. So he was startled to receive notice that the District Attorney’s office had rescinded its job offer with no explanation. Van Dyke speculates the reversal could be related to media coverage of a Twitter exchange he had involving a case he was working on in 2014. He has since filed suit seeking answers from Victoria County.

In a post on the website of Androvett Legal Media & Marketing, Rhonda Reddick quotes Dallas labor and employment attorney Leiza Dolghih of Godwin Bowman & Martinez, who says this is a cautionary tale for both employers and job-seekers.

The post continues:

“Many employers these days Google prospective hires and look them up on social media for any evidence of red flags that indicate that the applicant may be violent, unethical, unstable or simply have bad judgment. These behind-the-scenes, informal background checks often result in rejection, or even withdrawal, of a job offer,” she says.

While a Texas employer may reject a prospective candidate for a myriad of reasons, including social media activity, a prospective employee cannot be rejected on the basis of race, gender, religion, age or other protective categories – information that can often be gleaned from social media. If a candidate can show that a job rejection was based on information protected under employment law, there could be basis for a claim of discrimination.

“However, in this case, if the employer discovered what they considered unsavory comments, or possible evidence of poor judgment or lack of self-control, after offering Mr. Van Dyke a job, the withdrawal of that offer based on the newly discovered information, would be acceptable,” says Ms. Dolghih. “While everyone has the right to speak their mind freely, that speech may result in rather harsh consequences in terms of employment.”

 

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Fox News Hit With Suit Alleging Racial Discrimination and ‘Plantation-Style Management’

An expanded lawsuit filed Tuesday accuses Fox News Channel of racial discrimination “that appears more akin to Plantation-style management than a modern-day work environment,” reports the Associated Press.

Eight former and current Fox employees joined an existing case involving three former Fox workers who have accused a since-fired Fox financial executive of bias. It also expands the case to include Dianne Brandi, Fox’s chief counsel.

Fox News has denied the allegations.

“One plaintiff, on-air personality Kelly Wright, who’s black, said he’d been effectively sidelined and asked to perform the role of a Jim Crow, an insulting slang term to refer to a black man, according to the lawsuit. Wright said [Bill] O’Reilly, who’s white, refused to show a piece Wright had prepared after racial protests in Ferguson, Missouri, because they showed blacks in too positive a light,” writes AP reporter David Bauder.

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The SEC Doesn’t Like Your Employment Agreements

Employment contractFor the past two years, there’s been a new player in the world of employee whistleblower enforcement, writes Evan Gibbs for Above the Law.

In 2015, the Securities and Exchange Commission issued its first administrative order finding that a company violated SEC rules based on language in an employment agreement.

“In the first and only case of 2017, the SEC fined another company $340,000 because its standard severance agreement previously contained a provision in which employees waived recovery of incentive payments from the SEC,” Gibbs writes. “The company received the six-figure fine despite having removed the offending provision on its own in March 2016 as part of the company’s regular review process prior to being contacted by the SEC.third parties unless compelled to do so by law and after notice to the company.”

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Law Firm Expels Female Partner Who Filed Discrimination Suit

Partners at the law firm Chadbourne & Parke, in an unusual public gesture, voted on Thursday to expel from its ranks a female partner who filed a gender discrimination and pay inequity lawsuit against the firm last year, according to a New York Times report.

Campbell argued her case before the partners of the firm, but in a poll of the partnership conducted by telephone, she cast the only vote against expulsion. About 70 partners voted to expel her from the firm, Chadbourne said in a statement.

“On Monday, a federal district judge in Manhattan rebuffed her effort to block the vote, which her lawyers argued was retaliation for her lawsuit, which seeks $100 million and claims that the firm paid female partners less than their male counterparts and denied them advancement opportunities,” reports Elizabeth Olson. “Two other female partners have joined the lawsuit since it was filed in August in Federal District Court in Manhattan.”

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Is American Retail at a Historic Tipping Point?

E-commerceE-commerce players, led by the industry giant Amazon, have made it so easy and fast for people to shop online that traditional retailers, shackled by fading real estate and a culture of selling in stores, are struggling to compete, reports The New York Times.

Reporter Michael Corkery says the shift has been building gradually for years. But economists, retail workers and real estate investors say it appears that it has sped up in recent months.

“Between 2010 and 2014, e-commerce grew by an average of $30 billion annually. Over the past three years, average annual growth has increased to $40 billion,” writes Corkery.

While the retail industry has always had its ups and downs, but even to many experienced retail workers, who are used to losing their jobs based on the seasons, this downturn feels different, the Times reports.

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Neal Gerber Eisenberg Adds Partner to Employee Benefits & Executive Compensation

Linda Hoseman has joined Chicago-based Neal Gerber Eisenberg as a partner in the firm’sEmployee Benefits & Executive Compensation practice group.

Hoseman works with employee benefit matters, including designing and administering qualified retirement benefit plans and welfare benefit plans, the firm said in a release. She works with compliance issues and manages ERISA aspects and reviews of corporate, private equity, and other transactions.

“The addition of Linda to our practice group is great news for our firm and for our clients,” said Patricia S. Cain, chair of the firm’s Employee Benefits & Executive Compensation group. “I’m very confident that our clients will come to rely on Linda’s breadth of experience handling the complex employee benefit issues that arise in designing and administering retirement plans and health and welfare plans.”

“Linda is a wonderful addition and evidence of our commitment to adding depth with exceptional talent seeking an inclusive, collaborative and industrious culture,” Managing Partner Scott J. Fisher noted. “Her ability to design client-centered solutions while always keeping the client’s business imperatives foremost makes her a terrific asset.”

After graduating from Tulane University School of Law in 1989, Hoseman obtained an LLM in Taxation from NYU School of Law in 1994. She has also worked as an adjunct faculty instructor at John Marshall Law School. Most recently, she was a partner with Thompson Coburn LLP.

 

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Recent Developments on Sufficient Consideration for Employee Non-Compete Agreements

A blog posting by Sheppard, Mullin, Richter & Hampton discusses the varying state laws regarding sufficient consideration for non-compete agreements signed at both the outset and during employment as well as other recent attacks on non-competes and restrictive covenants generally.

“Like other contracts, non-compete and restrictive covenant agreements must be supported by adequate and sufficient consideration at the time of execution. However, what constitutes adequate consideration for a restrictive covenant, especially a non-compete provision, varies from state to state,” write 

Although some states will consider continued employment at the outset of the employment relationship sufficient consideration for an at-will non-compete, some states — for example, North Carolina, Montana, South Carolina, Oregon, Texas, Washington, and Wyoming — have expressly held that continued employment is insufficient consideration to support a non-compete entered into midstream of employment, the authors explain.

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Settlement Agreements: No ‘One Size Fits All’ Approach

check-box - agreement - contract - consentStephen Ravenscroft and Sarah Taylor of White & Case cite recent case law  to discuss the importance of using clear wording when drawing up a settlement agreement.

“Settlement agreements are a very useful tool for an employer,” they explain. “They normally draw a line under the employment relationship and provide certainty that an employee will not bring any employment- related claims. Such an agreement is often used to reach a full and final settlement of any claims which the employee has or may have arising out of the employment and its termination, subject to certain exceptions such as claims for personal injury or accrued pension rights.”

They warn, however, that employers must be aware that there is no “standard” settlement agreement.

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Bell Helicopter Ordered to Pay Significant Punitive Damages in Asbestos Death

A Dallas County jury found there was clear and convincing evidence that Bell Helicopter Textron Inc., Dickson’s employer for 38 years, was “grossly negligent” in exposing the longtime mechanical engineer to asbestos, according to a post on the website of Androvett Legal Media and Marketing.

Dickson, a resident of Hurst, Texas, died at the age of 74 on Dec. 13, 2013.

The jury awarded Dickson’s survivors $8.8 million, according to the website of his law firm, Simon Greenstone Panatier Bartlett.

“There was not a company-based respiratory protection policy in place during the time of Billy’s exposure,” said the plaintiffs’ attorney Darren McDowell of Dallas-based Simon Greenstone.

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If You Checked The Box, You’re Bound By The Contract

check-box - agreement - contract - consentPat Collins of Norris McLaughlin & Marcus discusses a recent decision by a New Jersey appellate court that highlights the well-established legal maxim that “when a party enters into a signed, written contract, that party is presumed to understand and assent to its terms.”

Writing in the firm’s employment law blog, Collins covers the case of ADP v. Lynch and Halpin. ADP sued two former employees who had resigned and went to work for one of ADP’s competitors.

ADP claimed they had violated terms of an agreement on a web page outlining incentive stock awards in exchange for the non-compete. Defendants argued that the clause covering the non-compete was merely an online check box that signified that they had read the agreement. It did not say they agreed to the terms, they argued.

The trial court and appeals court found otherwise.

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U.S. Investors Fight to Preserve SEC Rule on CEO Pay Ratio

SECReuters is reporting that more than 100 institutional investors opposed efforts by the U.S. securities regulator to delay a rule requiring companies to disclose a ratio comparing their chief executive’s pay with their workforce median.

The letter, signed by representatives of more than 100 unions, pension funds, activist investors, state treasurers and consumer advocacy groups urged Acting U.S. Securities and Exchange Commissioner Michael Piwowar not to delay the implementation of the rule, writes Sarah N. Lynch.

The requirement went into effect in January and could result in disclosures in many companies’ 2018 proxy statements unless the rule is delayed.

Piwowar said earlier this year that the SEC was accepting public comments on the rule, with an eye possibly to delaying implementation.

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Marissa Mayer’s $23-Million Severance From Yahoo May Look Obscene. But It’s Even Worse.

Marissa Mayer

Image by Magnus Höij

Before she was fired as CEO of Yahoo, Marissa Mayer’s golden parachute was estimated to be as high as $55 million. So the figure recently announced — $23 million — may not seem so outrageous.

“But looks can be deceiving,” writes reporter Michael Hiltzik for The Los Angeles Times. “One reason Mayer’s severance package appears to have shrunk is that the company’s latest disclosure leaves off tens of millions of dollars in stock options held by Mayer as of March 8, but already vested. So they aren’t subject to the accelerated vesting of $20 million in stock incentives that would result from the sale and Mayer’s departure from the company. That acceleration would provide the bulk of her severance.”

Because $56.8 million in options evidently have vested since the sale of the company to Verizon deal was announced in July, it’s reasonable to add them to the invoice, Hiltzik explains. “That puts Mayer’s out-the-door price nearer to $80 million.”

He said the situation raises some questions, including: Do America’s boards have any ability to distinguish good performance from bad, and pay their executives accordingly?

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Is Your Noncompete Agreement Enforceable?

Employment contractEmployers may think their noncompete agreement or restrictive covenant prohibiting departing employees from taking a similar job at a competitor is ironclad, but that’s not always true, warns David B. Ritter, a partner in the Chicago office of law firm Barnes & Thornburg.

Ritter participated in a question-and-answer exchange with SHRM Online about the enforceability of restrictive covenants, what to consider when crafting them and which states limit enforcement of these agreements.

The discussion covered such questions as: What should HR know about the enforceability of restrictive covenants? What else should employers consider when crafting these measures? Which states are particularly limiting when it comes to restrictive covenants?

The discussion is on the site of the Society for Human Resource Management.

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Reducing Workplace Violence

All companies are susceptible to claims based on workplace violence, writes Natalie Lynch of Lynch Law Firm in Austin. Due to deeply-rooted legal principles, employers can be held liable for the acts of their employees, even when such acts are intentional and not within the scope of employment. Workplace violence can take on many forms, making it essential for employers and HR professionals to know how to identify it and prevent it.

In an article posted on her website, she covers topics such as defining workplace violence, effects of workplace violence, risk factors.

She also offers some suggestions to prevent violence in the workplace, including: implement an anti-workplace violence program, encourage reporting, assess the worksite, provide safety training, provide communication devices, maintain work vehicles, and consider security.

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BigLaw Layoff Watch: 60 Staff Positions Across 22 U.S. Offices

Employment - hiringAbove the Law is reporting on another big layoff of BigLaw staff, asking the question: Has the Great Associate Pay Raise of 2016 ushered in the Not-So-Great Staff Layoffs of 2017?

David Lat writes that “approximately 60 staffers at Dentons were informed that [March 10] would be the last day at the firm. We heard from a number of the affected individuals, and some of them speculated that the layoffs were caused in part by the need to trim expenses in the wake of increased costs for associate compensation.”

Lat’s reporting found that the cuts appear to be centered on support staff. Also, bonuses and raises expected for remaining staff on April 1 will be delayed.

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8th Circuit: No Contracting Out of WARN Act Obligations Where Sale of Business is ‘Going Concern’

The 8th U.S. Circuit Court of Appeals issued an opinion reminding employers that they cannot contract out of the Worker Adjustment and Retraining Notification Act (WARN) obligations requiring employers to provide 60 days’ written notice to employees of a plant closing or mass layoff, according to a post on the website of Winston & Strawn LLP.

In Day v. Celadon Trucking Services, Inc., the circuit court held that the purchaser of a business, Celadon Trucking Services Inc., was responsible under the WARN Act for providing notice of a mass layoff to more than 400 employees, even though Celadon never hired or fired those employees, the sales agreement characterized the transaction as a sale of assets, and stated that the seller, Continental Express Inc., was solely responsible for providing the WARN notices.

Steve Sheinfeld and Jeffrey Salomon wrote the article.

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