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!

What’s a financial advisor to do? On March 15, 2018, the Fifth Circuit Court of Appeals in Chamber of Commerce of the U.S. v. U.S. Dep’t. of Labor, No. 17-10238, 2018 U.S. App. LEXIS 6472 (5th Cir. Mar. 15, 2018) vacated – thereby invalidating – a series of seven rules (which we collectively refer to in this post as the “fiduciary rule”) issued in April 2016 by the Department of Labor (DOL). The fiduciary rule vastly expanded the reach of the ERISA fiduciary standards that apply to individuals and entities providing investment advice. This post first explains the state of the law prior to the fiduciary rule; it then discusses the impact of the rule on the arguments that the Court grappled with; and it concludes by handicapping the options available to regulated financial advisors and institutions as they endeavor to respond.

Continue Reading Fifth Circuit Court of Appeals Invalidates the 2016 Final Department of Labor Fiduciary Rule and Related Prohibited Transaction Exemptions

Written by Brendan Lowd

Just before Thanksgiving, a Texas federal court judge issued an injunction blocking the closely-watched new federal overtime rule from taking effect as scheduled on December 1, 2016.  As expected, the DOL is not going quietly into the night and the parties have engaged in a flurry of court filings as the fight, at least in part, concerning whether the new rule is lawful shifts to the United States Court of Appeals for the Fifth Circuit.

Continue Reading The Saga Continues on the Fate of the DOL’s Overtime Rule

The Fifth Circuit recently held that a third party witness who was fired after providing information in response to her employer’s investigation of a coworker’s harassment allegations had to demonstrate she had a “reasonable belief” that the conduct she reported violated Title VII in order to prove her retaliation claim.

Continue Reading Fifth Circuit Holds Third Party Witness’ Retaliation Claim Requires “Reasonable Belief” That a Title VII Violation Has Occurred

The Fifth Circuit recently sided with an employer in an off-the-clock overtime case where the employee failed to comply with her employer’s overtime approval and reporting policies.  For employers, this decision highlights the importance of implementing overtime authorization and reporting policies to defeat these claims.

Continue Reading Fifth Circuit Rejects Employee’s FLSA Off-the-Clock Claim; Highlights Importance of Overtime Authorization and Reporting Policies in Off-the-Clock Cases

The battle between the NLRB and the Fifth Circuit rages on, as the Fifth Circuit again ruled that employers do not violate the National Labor Relations Act when they require employees to sign arbitration agreements containing class/collective action waivers.

Continue Reading Fifth Circuit (Again) Reverses NLRB and Finds Class Action Waivers in Arbitration Agreements Do Not Violate the NLRA

While the Dodd-Frank Act provides various protections to whistleblowers, federal courts have inconsistently interpreted who precisely qualifies as a whistleblower.  In a much-anticipated opinion, the Second Circuit Court of Appeals held, in Berman v. Neo@Ogilvy LLC, that whistleblowers who report wrongdoing internally – but not to the Securities and Exchange Commission – are protected from retaliation under the law.

Continue Reading Internal Whistleblowing Protected Against Retaliation Under Dodd-Frank, Says Second Circuit

A Federal Appeals Court recently confirmed that under certain circumstances, parties may privately settle and release claims under the Fair Labor Standards Act.  A generic release contained in a settlement agreement won’t do it; instead, the parties must cite to a bona fide dispute regarding wages in the settlement agreement.  But this decision extends only to the borders of the Fifth Circuit, which encompasses Texas, Louisiana and Mississippi.  Most other circuit courts would not enforce such releases unless they were the product of an agreement supervised by a court or the Department of Labor.

Continue Reading Fifth Circuit Continues to Permit Wage Claim Waivers in Private Settlements, But Only Where a Bona Fide Dispute Exists

Written by Brent Douglas

In its Murphy Oil decision, the National Labor Relations Board affirmed its 2012 holding in D. R. Horton, which found an employer violates the NLRA when it requires employees “as condition of their employment, to sign an agreement that precludes them from filing joint, class, or collective claims addressing their wages, hours, or other working conditions against the employer.” Employment attorneys were waiting to see how the NLRB would react to the Fifth Circuit Court of Appeals’ reversal of its 2012 D. R. Horton decision.  Unpersuaded, the Board indicated it “independently reexamined” D. R. Horton and concluded: “Today we reaffirm that decision.”

Continue Reading NLRB Again Attempts to Invalidate Mandatory Arbitration Clauses for Employment Claims