In an article in the Polsinelli blog “Polsinelli at Work,” shareholder James C. Sullivan writes about how unsettled the law is on employer/employee arbitration provisions containing class/collective action waivers. For now, some guidance on the issue may depend upon where a case is filed, and the Supreme Court likely will resolve the conflicting lower court decisions on the issue.

“Five years ago, the United States Supreme Court in AT&T Mobility LLC v. Concepcion ruled, in a 5-4 decision written by Justice Scalia, that state laws prohibiting the enforcement of consumer contracts containing an arbitration provision with a class action waiver were contrary to the Federal Arbitration Act. Within a year of that decision, the National Labor Relations Board in D.R. Horton ruled that Concepcion did not apply in the context of employee rights under the National Labor Relations Act, specifically § 7 which vest employees with the right to engage in ‘concerted activities,’ ” writes Sullivan.

The Fifth Circuit, the Second and Eleventh Circuits have ruled that class/collective action waivers in employer-employee arbitration agreements are enforceable. But in June 2016, the Seventh Circuit  turned the tide, becoming the first federal court of appeals to adopt the NLRB’s rationale in D.R. Horton. And later the Ninth Circuit adopted the reasoning of the Seventh Circuit.

Read the article.

If you want your electronic contracts to be enforceable, it is a best practice to require the counterparty to affirmatively accept the contract by checking a box or clicking a button, write Nikita A. Tuckett and Aaron Rubin on Morrison & Foerster LLP’s Socially Aware blog.

“A recent New Jersey district court decision, ADP, LLC v. Lynch, reinforces this point. Such issues most often arise in the context of website terms of use, but ADP v. Lynch involved a non-competition provision and forum selection clause contained in documentation presented to employees electronically in connection with stock option grants,” the authors write.

They continue: “ADP had presented the documentation in such a way that each employee was physically unable to click the required ‘Accept Grant’ button unless he or she had affirmatively checked a prior box indicating that he or she had read the associated documents containing the restrictive covenants and forum selection clause.”

The court denied the employees’ motion to dismiss.

Read the article.

NAVEX Global will webcast a free webinar outlining updates to FLSA requirements, presented by Scott M. Nelson, a national labor and employment law authority from Baker & McKenzie, on Thursday, Sept. 22. The hour-long webinar will begin at 10 a.m. PDT (1 p.m. EDT).

New Fair Labor Standards Act (FLSA) regulations will go into effect on Dec. 2, updating the salary and compensation levels for exempt employees, impacting millions of salaried workers.

Wage and hour cases represent the most significant exposure to employers under workplace laws, NAVEX Global says on its website. This webinar will explain responsibilities and options for complying with the FLSA’s overtime provisions.

Register for the webinar.

Kerrie L. Campbell brought more than two decades of experience in consumer product safety and product defamation litigation when she joined the Washington office of the Chadbourne & Parke in January 2014, but she contends that other Chadbourne partners shut her out of leadership positions and paid her far less than male partners at her level, reports The New York Times.

“After being told this year that she would be terminated, she sued in federal court on Wednesday, asking for a total of $100 million on behalf of herself and other female partners who, she said, receive less compensation than male partners even when they bring in more client revenue,” writes Elizabeth Olson. “A five-man management committee at the firm arbitrarily awards male partners more points, which translate into higher dollar compensation, than they do to women, she maintained.”

In a statement responding to the suit, Chadbourne denied the gender discrimination claims, saying her complaint against the firm is riddled with falsehoods and “will be shown to be completely baseless.”

Read the article.

Ernst & Young LLP cannot require its employees to give up their rights to pursue work-related claims together, a federal appeals court has ruled, giving a major boost to the U.S. National Labor Relations Board’s campaign against so-called class action waivers, reports Reuters.

“Companies have increasingly included provisions in employment contracts forcing workers to arbitrate claims individually as a way to avoid the cost of litigating class actions,” writes Robert Iafolla. “The NLRB has struck down such requirements imposed by dozens of companies, including American Express Co, Citigroup Inc and Domino’s Pizza Inc.”

The court found that the arbitration agreement violated the National Labor Relations Act by making workers arbitrate work-related claims as individuals in separate proceedings.

Read the article.

Image by Gage Skidmore

Donald Trump’s power to nominate Supreme Court justices if elected to the White House is a threat to women workers, equal pay advocate Lilly Ledbetter and two union officials said, according to a report by Bloomberg Law.

Ledbetter was a former Goodyear tire plant supervisor who sued her employer after she discovered she was making less than her male colleagues after 20 years on the job. She lost that pay discrimination case at the Supreme Court in 2007. Congress responded by passing the Lilly Ledbetter Fair Pay Act to allow more time for claimants in federal pay bias claims.

“Ivanka Trump said during the Republican Convention that her father would likely look at the the pay bias issue,” reports Bloomberg’s Chris Opfer. “The AFL-CIO’s Shuler blasted the GOP nominee, however, for later saying on the campaign trial that he would expect his daughter to leave her job if she was being discriminated against.”

Read the article.

Health officials reported the first spread of the Zika virus from state to state when a Texas man got the disease after visiting a section of Miami where mosquitoes have been spreading Zika.

The Zika virus can cause brain damage and other birth defects in infants if the mother is infected during pregnancy. While its dangers first appeared in Brazil, its spread to the U.S. has magnified questions about risk, including to workers whose employers want them to travel.

For example, what steps are employers legally required to take if they need an employee to travel to a hot zone? What is the liability if an employee contracts the disease, which also can be sexually transmitted and spread when a mosquito bites an infected person and carries it to someone else?

Androvett Legal Media & Marketing has posted an article on its website quoting Justin Markel, a labor and employment lawyer in the Houston office of Roberts Markel Weinberg Butler Hailey PC:

“Under the Occupational Safety and Health Act, employees may refuse to work in certain circumstances when working conditions are dangerous. Among other things, the employee must genuinely believe that an imminent danger exists, and there must be a real danger of death or serious injury. Because of the way Zika is transmitted and the availability of preventive measures, it is unlikely that an employee could refuse to travel on this ground – unless the employee is pregnant.

“However, employers should be cautious when an employee refuses such a work assignment. An employee could argue that she is protected by OSHA and is shielded from adverse employment actions.”

Markel says that employer liability depends in part on participation in the worker’s compensation system. In Texas, employers have the option of whether to participate, he notes. “If the employee is covered by workers’ comp insurance, and if it could be proven that the employee contracted Zika while working, then the employee may have a workers’ comp claim. That would also mean that workers’ comp benefits are the employee’s exclusive remedy.

“If the employer does not subscribe to workers’ comp, then the employer may be liable for failing to provide a safe work environment if the employer does not take reasonable precautions to protect against Zika exposure,” he says.

Markel says employers with workers in affected areas should focus on educating their workforce about precautionary measures. OSHA has published helpful guidance here. Employers should try to limit standing water near worksites, and employees working outside should use mosquito repellant and wear long sleeves and pants.

U.S. Transportation Secretary Anthony Foxx

Bloomberg Law examines a lawsuit involving U.S. Transportation Secretary Anthony Foxx, who is the target of an attempt to recover salary Foxx collected during his three-and-a-half year tenure as deputy general counsel at a now-defunct company.

“From 2009 to 2013, Foxx worked as a deputy general counsel at the bankrupt Charlotte bus maker DesignLine. During that time, he also served as mayor of Charlotte on a part-time basis, writes Gabe Friedman. “Now, the liquidating trustee in bankruptcy court is seeking to recover his pay — as a fraudulent transfer — during a three-and-a-half year stretch.”

The salary in question works out to $309,760, or $88,502.86 per year.

“The parties in the case have agreed to participate in a voluntary, non-binding mediation in Charlotte that will occur on or before Sept. 30, according to an order filed in federal bankruptcy court this month,” according to The Charlotte Observer.

Read the article.

HR Daily Advisor will present a complimentary webinar discussing what the overtime changes mandated by the U.S. Department of Labor FLSA mean for employers and recommend strategies for meeting these new challenges.

The event, sponsored by Kronos, will be Thursday, August 25, beginning at 2 p.m. EDT.

The overtime changes will extend overtime pay protections to more than four million American workers, HR Daily Advisor says on its website. The implications are enormous, affecting everything from job classifications and time tracking to compensation and compliance policies.

Register for the webinar.

In a rare case interpreting the Worker Adjustment and Retraining Notification Act “sale of business” exception, the 8th U.S. Circuit Court of Appeals recently held in Day v. Celadon Trucking Servs., Inc. that a buyer of a business remained liable under WARN to the seller’s employees to whom the buyer did not make offers of employment, despite provisions in the asset purchase agreemen that placed all WARN Act liability on the seller, according to Epstein Becker & Green.

In the firm’s Financial Services Employment Law blog, Marc A. Mandelman wrote that the case involved a typical asset purchase transaction between Continental Express, Inc. and Celadon. Plaintiffs were a class of 449 former Continental employees who were not offered jobs with Celadon after the purchase of Continental’s trucking business.

“The key takeaway of the Day case for parties to a corporate transaction is that WARN liabilities are governed by statute, and the implications of WARN obligations and the sale of business provision of WARN must be carefully evaluated,” according to Mandelman.

Read the article.

Eric Goldman, writing in the Technology & Marketing Law Blog, discusses a case in which an employer successfully sued two departing employees for joining a competitor. The employer based its suit in part on a non-compete clause included the stock option grant documentation presented to employees electronically.

“We already knew that clickthrough agreements work really well in the B2B and B2C contexts,” writes Goldman. “Thus, it’s not surprising that clickthrough agreements also work in the employment context, at least so long as they are supported by consideration (and stock option grants usually, if not always, will provide sufficient consideration for additional contract terms). Although ink-signatures-on-dead-trees remains the gold standard for forming contracts with employees, forming contracts with employees online is probably a better method than some other traditional techniques, such as circulating employee handbooks or memos and embracing the fiction that an employee continuing to show up at work constituted acceptance. A clickthrough agreement provides tangible evidence that employees ‘got the memo’ (even if they chose not to read it); and the fact that no one reads online contracts is inconsequential in the context of employee handbooks, which are also widely celebrated as documents that no one reads.”

Read the article.

An article written by Deborah H. Share for Porzio, Bromberg & Newman‘s Employment Law Monthly reports that employers cannot contract with employees to reduce limitations periods for discrimination claims, according to a recent New Jersey Supreme Court decision.

According to the facts of the suit as presented to the court, a job applicant signed an application form that included language that appeared to waive any statute of limitation in the filing of a lawsuit against the employer. The language limited the applicant to a deadline of six months from the date of any alleged employment action that was the subject of a suit.

Share’s article detailed the court’s reasoning and listed and discussed three recommendations for employers to consider: remove such waivers from applications, shore up all processes related to employee terminations, and consider other useful tools for employers in this area.

Read the article.

Image by NY Photographic

Barbara E. Hoey and Dustin E. Stark of Kelley Drye’s Labor and Employment group have a warning for New York employers – your non-compete agreements may be under attack.

In an article published on the firm’s Labor Day blog, the authors wrote that the office of the state’s attorney general recently reached settlements with two companies that require each to stop requiring incoming employees to sign non-compete agreements.

“The settlements clearly send a signal that the New York AG is critical of employers who require low-level employees to sign non-competes as a condition of employment. These agreements were never favored by New York courts, and this may be the time to re-think the broad use of such contracts,” according to the report.

“The take-away here is that if your company requires that all (or a large number of) employees sign non-compete agreements, you should re-examine this process. For one, a non-compete signed by a ‘low-level’ employee may not be enforceable anyway. Second, you do not want to wind up to be the next subject of an AG investigation,” they write.

Read the article.

Littler Mendelson will present a webinar about maintaining compliance under Title VII of the Civil Rights Act as it concerns protection of employees, both legal and illegal immigrants.

The hour-long webinar will be Wednesday, August 31, at 1 p.m. Eastern time.

In a recent undocumented worker case, the Fourth Circuit Court of Appeals ruled that the EEOC has the authority to investigate claims made by both legal and illegal immigrants, the firm said on its website. This decision has heightened employers’ attention as to who in their workforce is protected under Title VII of the Civil Rights Act and added to an already complex system of compliance standards set by the EEOC and OSC.

Topics will include:

• What changes do employers and in-house counsel need to be aware of?
• Who in your workforce is protected?
• What are the common pitfalls that lead to discrimination claims?
• What procedures can you implement to reduce legal risk?

Register for the webinar.

The 8th Circuit Court of Appeals recently addressed an issue that frequently arises in the non-compete context: what happens when a company buys the assets of another and then tries to enforce non-compete agreements?

Michael Elkon of Fisher & Phillips LLP explains in the article: Two employees worked as mobile x-ray technicians for Ozark Mobile Imaging. Both signed non-compete agreements saying they could not work in the mobile diagnostic business in a set geographic area for a two-year period after the end of their employment. Mobilex later bought Ozark in an asset purchase, and both employees declined offers to work for Mobilex, citing inferior terms of employment, and instead took positions with a competitor. Mobilex filed suit against the ex-employees for breach of contract, but the district court granted summary judgment to Greenbaum and Tabanag, finding that because they had not consented to the assignment of their contracts at the time of the asset purchase.

The appellate court reversed, providing a reminder that “it is important to pay attention during the sale process to ensure that there will be no issues with the purchaser enforcing the seller’s restrictive covenant rights with employees,” Elkon writes.

Read the article.

Littler Mendelson, the world’s largest employment and labor law practice representing management, has released the results of its 2016 Executive Employer Survey. The fifth annual survey, completed by 844 in-house counsel, human resources professionals and C-suite executives from some of America’s largest companies, examines the key legal, economic and social issues impacting employers as the 2016 presidential election approaches.

New Overtime Rules, Aggressive DOL Enforcement Plague Employers

The Department of Labor (DOL) has advanced several regulatory initiatives that have brought the agency’s enforcement of federal employment laws more to the forefront for employers. The vast majority of respondents to this year’s survey (82 percent) expect DOL enforcement to have an impact on their workplace over the next 12 months, with 31 percent anticipating a significant impact (up from 18 percent in the 2015 survey).

This concern is no doubt driven in large part by the recently finalized Fair Labor Standard Act “white collar” overtime regulations that drastically increase the number of Americans who can qualify for overtime pay. Although respondents completed the survey in the weeks prior to the release of the final rule, 65 percent had already conducted audits to identify affected employees.

“Employers are clearly feeling the impact of the DOL’s increasingly aggressive regulatory agenda, most notably the new overtime regulations,” said Littler attorneys Tammy McCutchen and Lee Schreter in a joint statement. “While it is encouraging that the majority of respondents started to prepare before the rule was finalized, more than a quarter (28 percent) said they had taken no action given delays in the rulemaking process. Given that the reclassification process can take up to six months and the rule is unlikely to be blocked from going into effect on December 1, 2016, employers should move quickly to ensure compliance.”

Further, in ranking the priority they expect a presidential candidate from each party to place on various issues, the majority of respondents (75 percent) said income inequality (e.g., overtime rules, state equal pay, minimum wage laws, etc.) would be a significant priority of the Democratic candidate. This is in comparison to only 4 percent who felt income inequality would be a significant priority of the Republican candidate.

Joint Employer, ACA among Top Regulatory and Legislative Issues Facing Workplace

Increased DOL enforcement is just one example of employers grappling with a continuously shifting regulatory and enforcement landscape, as federal agencies continue to be the governmental bodies inflicting the most pressure on employers.

With the National Labor Relations Board’s recent expansion of the definition of a “joint employer,” 70 percent of respondents expect a rise in claims over the next year based on actions of subcontractors, staffing agencies and franchisees. Approximately half of respondents predicted higher costs (53 percent) and increased caution in entering into arrangements that might constitute joint employment (49 percent).

“It is significant and telling that only 2 percent of respondents said the expanded definition of a joint employer will have no impact on their workplace,” said Michael Lotito, co-chair of Littler’s Workplace Policy Institute. “This finding shows the breadth of the NLRB’s decision, overturning a standard of joint employment that had been in place for decades, which required a relationship that was actual, direct and substantial.”

As was the case in the 2015 survey, 85 percent of employers said the Affordable Care Act (ACA) would have an impact on their workplace in the next 12 months. While two-thirds said they do not expect a repeal of the ACA if a Republican is elected president this fall, respondents saw a greater likelihood of changes to individual provisions. Fifty-three percent said a Republican administration could lead to a repeal of or changes to the Cadillac excise tax and 48 percent saw a likelihood for changes to the play-or-pay mandate.

Rising Public Attention to Social Issues Influences the Workplace

Employers have always had to keep an eye on demographic and social trends, but as information spreads more rapidly and as office culture shifts to accommodate a new generation, today’s companies are increasingly experiencing the incursion of social issues into the workplace.

In the largest year-over-year change in Littler’s survey results, 74 percent of respondents expect more discrimination claims over the next year related to the rights of LGBT workers (up from 31 percent in 2015) and 61 percent expect more claims based on equal pay (up from 34 percent in 2015). This change is driven by LGBT discrimination and equal pay ranking among the top enforcement priorities for the Equal Employment Opportunity Commission (EEOC), but it also mirrors key focus areas for the Obama administration, government efforts at the state and federal levels, and increased public awareness.

“The EEOC has sent a clear signal that it will continue to prioritize rooting out discrimination based on sexual orientation and equal pay, so employers’ instincts that claims in this area will likely rise are right on the mark,” said Barry Hartstein, co-chair of Littler’s EEO & Diversity practice. “As LGBT rights and the gender pay gap continue to be in the headlines and topics of discussion among the general public, employers can expect to face increased pressure to address these issues in the workplace.”

In addition, the changing nature of work and the rise of the so-called gig economy have given companies more hiring options than ever, including independent contractors, contingent workers and an online workforce. While this shift has created greater flexibility for workers and increased efficiency for employers, it has also given rise to more independent contractor misclassification lawsuits and regulatory investigations. Despite the legal challenges, more than half of respondents at large-cap organizations either said they were not reluctant to hire more freelancers or contractors (24 percent) or they were neutral on the matter (35 percent).

Employers Take Steps to Prevent Workplace Violence

In response to tragic mass shootings across the nation, companies are taking a range of actions to keep their employees safe, including updating or implementing a zero-tolerance workplace policy (52 percent), conducting pre-employment screenings (40 percent) and holding training programs (38 percent). Only 11 percent of respondents said they had not taken any action because violence is not a concern for their company.

“Putting policies in place to increase awareness of workplace violence and ensure that employees understand how to report threats in the workplace are steps that all employers would be advised to take,” said Terri Solomon, a Littler shareholder with extensive experience counseling employers on workplace violence prevention. “Unfortunately, even though workplace violence – and particularly active shooter instances – are statistically rare, no employer is truly immune, so taking preventative action can help save lives.”

View the 2016 Executive Employer Survey Report here: http://www.littler.com/files/2016_littler_executive_employer_survey.pdf

About Littler

Littler is the largest global employment and labor law practice, with more than 1,000 attorneys in over 70 offices worldwide. Littler represents management in all aspects of employment and labor law and serves as a single-source solution provider to the global employer community. Consistently recognized in the industry as a leading and innovative law practice, Littler has been litigating, mediating and negotiating some of the most influential employment law cases and labor contracts on record for over 70 years. Littler Global is the collective trade name for an international legal practice, the practicing entities of which are separate and distinct professional firms. For more information visit: www.littler.com.

Practical Law will present a free webinar about new DOL regulations that make major changes to the definition of “fiduciary investment advice” under ERISA.

The event will be Wednesday, July 13, at 1 p.m. Eastern time.

Practical Law’s webinar will explain the new standards and how they will affect investment advisers who give retirement advice and sell retirement products such as IRAs. The webinar will also focus on what plan sponsors need to do to comply.

Presenters:

George Sepsakos, Groom Law Group, (Washington, DC)

Heidi Winzeler, Director, Practical Law Employee Benefits & Executive Compensation

Register for the event.

Businesses need to have written protocols in place to deal with bankruptcy filings by their employees and independent contractors, or they risk serious sanctions and, potentially, punitive damages for violations of the bankruptcy laws, according to a report in Hunton & Williams’ Employment & Labor Law Perspectives blog.

The article discusses two scenarios: one in which the employer has unwittingly violated the Bankruptcy Code, and another in which the employer has knowingly violated the automatic bankruptcy stay by taking an action to collect a pre-bankruptcy debt from post-bankruptcy earnings.

“A process should be developed whereby notices relating to bankruptcy cases are channeled to a designated member of the legal or accounting team trained to immediately take action to ensure payments are correctly routed and stay violations are avoided,” the article says.

Read the article.

Hatmaker Law Group will present a free one-hour webinar covering new laws passed during 2016 impacting California employers and legislation pending on the horizon.

The event will be Wednesday, July 20, beginning at noon Pacific time.

The webinar also will cover notable employment law judgments and what the rulings mean for California businesses, the firm said in a release.

Register for the event.

FedEx Ground Package System Inc. has agreed to pay drivers in 20 states $240 million to settle lawsuits claiming the second-largest U.S. parcel delivery company misclassified them as independent contractors, it said on Thursday, according to a Reuters report.

Reporter Daniel Wiessner said Beth Ross, lead lawyer for the plaintiffs, said in an email that the settlement, if approved, would be divided among 12,000 drivers, some of whom would receive tens of thousands of dollars.

FedEx previously contracted directly with independent operators in an effort to save on taxes, fringe benefits, health care costs, pensions and other workers’ costs.

“The deal, subject to approval by a federal judge in Indiana where the cases were consolidated, would end nationwide litigation claiming that because drivers were required to use company-branded trucks, uniforms and scanners, FedEx was their employer under federal and state laws,” Reuters reports.

Read the article.