In our sister blog, ADR: Advice from the Trenches, Don Davis explores back-to-back decisions by New York’s intermediate appellate court that applied very narrow state law principles permitting vacatur of an arbitration award on public policy grounds to vacate an arbitrator’s award that had reduced the employer-posed penalty of termination to a brief suspension. In so doing, the court implicitly endorsed the employer’s decision to terminate an employee that it found, after an investigation, to have engaged in sexual harassment. The court found that the arbitrator’s reduction of the penalty – despite having made findings of fact that supported the employer’s decision – would have operated to undermine the state’s strong public policy against sexual harassment in the workplace.
With the summer kicking off, it is a good opportunity for employers to review and refresh their employment practices to ensure compliance with developments on the federal, state and legal landscape. This Bubbler Post will review our earlier guidance and (hopefully!) prompt you to review your employment practices:
- Employment Applications: Equal pay laws have continued to gain traction on the state and local level, and there are a number of jurisdictions banning inquiries into the salary history information of prospective applicants. If you have employees working in the states, counties and/or cities listed below, you should review your application forms and employment documents to ensure that they do not request salary information.
- States Banning Pay Inquiry
- Counties Banning Pay Inquiry
- Albany County, New York (effective December 17, 2017)
- Westchester County, New York (effective July 9, 2018)
- Cities Banning Pay Inquiry
- New York City (effective October 31, 2017)
- Philadelphia (pending in federal court)
- San Francisco (effective July 1, 2018)
- Vendor Relationships: Given the pay inquiry laws discussed above, employers should communicate with recruiters and background check companies to ensure that these entities similarly comply with their obligations under applicable law. You can write a letter to your vendors detailing your expectations, you can enter into an amendment to your existing agreement outlining the legal framework, or you can reach out to your vendor contact to discuss the importance of compliance – from both a business and legal perspective – and request that they remove salary history inquiries from their screening process. Whatever you do, be conscious of the potential for joint liability to attach to these claims. Particular provisions to consider are ones regarding compliance with applicable laws and indemnification.
- Employment Agreements: In light of the Supreme Court’s landmark decision holding that employers can enforce class action waivers in arbitration agreements, employers should review and revise their employment agreements to include this language. You can include a class or collective action waiver either by (1) explicitly prohibiting class/collective claims or (2) explicitly requiring that all claims be brought by employees individually and not jointly. Here, we’ve laid out more guidance on this decision’s impact on employers, including factors employers should consider when deciding whether to adopt an arbitration provision with a class waiver and the impact on state law prohibitions on arbitration.
- Employee Trainings: In the wake of the #MeToo movement, workplace professionalism trainings are more relevant than ever. And, in some jurisdictions, they are required. Read more here about the steps New York State and New York City have taken to implement stronger protections against workplace harassment. Employers in other jurisdictions should take note, and perhaps jump on board. While not a complete defense, evidence of thorough and detailed trainings around appropriate workplace conduct can limit liability for an employer defending against a sexual harassment claim. We almost always suggest more training.
- Settlement Agreements: On the federal level, employers should be thoughtful of their obligations under the Tax Cuts and Jobs Act of 2017. Pursuant to a new provision in the tax code overhaul bill – Section 13307 – employers can no longer deduct the taxable income of any sexual harassment settlement amount subject to a non-disclosure agreement. We’ve discussed this here and will continue to track employers’ obligations as additional guidance is issued. In the meantime, employers should tread carefully and make an informed decision about whether to take a tax deduction or include a non-disparagement provision.
On May 15, 2018, Governor Hogan signed into law the “Disclosing Sexual Harassment in the Workplace Act of 2018” (the “Act”). The Act will go into effect on October 1, 2018, and contains two new obligations with which Maryland employers will need to comply.
Over the past several years, health care entities have increasingly become the target of private and government plaintiffs complaining of disability discrimination. A crescendo of litigation has engulfed the health care industry—and most notably of late, “drive-by” litigation attacking the perceived failure of health care entity facilities and websites to accommodate the needs of persons with disabilities consistent with the requirements of the Americans with Disabilities Act (ADA).
Read the full article below or here: The Rising Tide of ADA Litigation Against Health Care Entities (©Copyright 2018, American Health Lawyers Association, Washington, DC. Reprint permission granted.)
Welcome back for this month’s edition of the Bubbler! There’s plenty to talk about, so let’s jump right in.
The California Supreme Court issued an important decision this week addressing the test for whether a worker is an independent contractor or an employee. The U.S. Supreme Court declined to review a Seventh Circuit decision upholding an employer’s rule that a months-long leave of absence was not a reasonable accommodation. The Ninth Circuit held that employers are prohibited from using an employee’s past salary as a legitimate “factor other than sex” for purposes of defeating a Fair Pay Act claim, emphasizing that allowing the inclusion of prior salaries would only perpetuate gender pay disparity. The Fifth Circuit downsized ERISA fiduciary standards in a ruling that invalidated a set of seven expansive fiduciary rules. The Northern District of Illinois issued an unusual ruling, holding that two plaintiffs’ claims were subject to an enforceable arbitration agreement, yet refused to compel arbitration. The DOJ challenged a set of competitors’ no-poaching agreements as per se violations of the Sherman Act, which regulates concerted anti-competitive action. Finally, in the wake of the #MeToo movement, New York (state and city) have passed new laws concerning workplace sexual harassment.
As always, stay tuned for more employment matters updates!
Following in the footsteps of neighboring jurisdictions such as New York City, Albany County, and Massachusetts, on April 10, 2018, Westchester County enacted legislation to ban inquiries into a job applicant’s salary history. The stated purpose of the law is to halt the perpetuation of the gender wage gap and to assist older workers and others returning to the workforce after a long hiatus.
New Jersey Governor Phil Murphy recently signed into law a bill that provides equal pay protections for members of certain protected classes. Governor Murphy also signed into law a bill that requires New Jersey employers to provide paid sick leave to employees.
A summary of both laws is provided below:
In the wake of the #MeToo movement and the nationwide discourse over the prevalence of sexual harassment in the workplace, New York State and New York City have taken aggressive steps to implement stronger protections against workplace harassment. These new protections, which are now law in New York State and New York City, will require New York employers to revise their policies, procedures and agreements, deliver new training, and provide employees with additional information about sexual harassment. Below, we summarize the new requirements and other changes in the law and discuss next steps.
The Ninth Circuit Court of Appeals issued an important decision last week in Rizo v. Yovino, holding that an employer may not use an employee’s prior salary history to justify gender pay disparity under the federal Equal Pay Act.
Lots to talk about in the Labor & Employment world! The Massachusetts Pregnant Workers Fairness Act went into effect on April 1, 2018, imposing stricter non-discrimination rules on employers of pregnant workers. The U.S. Department of Labor launched the Payroll Audit Independent Determination program, which encourages employers to self-report wage and hour violations. The Sixth Circuit issued a decision in EEOC v. R.G. & R.G. Harris Funeral Homes, holding that transgendered employees are protected under Title VII, even mounted against an employer’s religious objections under the Religious Freedom Restoration Act. The Commonwealth of Massachusetts lost a step in the legal challenge to the contraceptive mandate exemptions in the Affordable Care Act, on the grounds that it did not have standing to assert the relief it sought. Still on the federal landscape, Congress added an amendment to the FLSA in the recent omnibus budget bill, providing that an employer may not keep tips received by its employees for any purpose. The Supreme Court issued an important ruling holding that service advisors are exempt from the FLSA’s overtime requirements and rejecting the principle that FLSA exemptions should be narrowly construed. The State of Washington followed suit with many other states, including California, New York, and Massachusetts, becoming the most recent state to add an updated Equal Pay Act, and a “Ban the Box” law. In the wake of the #MeToo movement, Washington also barred nondisclosure agreements in sexual harassment suits. As always, stay tuned for further updates and more details on these developments which we will be covering more extensively here in the coming weeks, including a post on the Massachusetts Pay Equity Act coming up later this week.
Finally, there’s still time! Don’t forget to register to attend our Fourth Annual Employment Law Summit on April 19.