Six Reasons Why Wholesale Repeal of Dodd-Frank is Unlikely

Donald Trump Dodd Frank repealIn the days following the November elections, U.S. President-elect Donald J. Trump promised that his Financial Services Policy Implementation team would be working to “dismantle” the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). However, a more recent account in the Wall Street Journal reported Mr. Trump’s transition team as tempering his promise in favor of rescinding or scaling back the individual provisions Republicans find most objectionable.

In light of the current political and macro-economic environment, here are six reasons why a wholesale repeal of Dodd-Frank is unlikely to occur:

  • Congressional Resistance – A wholesale repeal of Dodd-Frank would have to be effectuated through congressional action and would likely face a democratic filibuster. This would require opponents of Dodd-Frank to muster a 60-vote block in the Senate in order to advance the proposal. Legislative horse-trading to achieve specific objectives that are key to the Republican majority may ultimately prove to be more strategically advantageous.

  • Public Perception – Actions of the new administration which could be perceived as advocating for easing the burden on the financial services industry may alienate the middle-class constituency who were significantly impacted by the great recession and who ultimately propelled Mr. Trump to the Presidency.

  • Balance of Cost – Following massive investments in infrastructure and processes, the industry may perceive the costs of undoing the compliance programs put in place subsequent to Dodd-Frank as outweighing the benefits to be derived from decreased regulation.

  • Accepted Expectations – Counterparties have come to accept the safeguards and reporting requirements put in place by Dodd-Frank as constituting baseline expectations in business transactions. A repeal of Dodd-Frank would leave industry participants to reconstruct by contract what may have been previously mandated under law.

  • International Developments – In the wake of the Brexit vote, international financial organizations may be evaluating the relocation of their operational centers to locations in the U.S. The possibility of significant financial regulatory overhauls and the accompanying specter of an unknown business environment may dissuade consideration of the U.S. by such organizations.

  • Absence of a Perceptible Problem – Dodd-Frank was passed on July 21, 2010 with the wake of the great recession providing momentum and popular support for its enactment. Conversely, there is no corresponding economic situation presently existing that critics can point to for its repeal. The DJIA is up approximately 90% since July 2010. The real estate market has remained strong and, even with the recent increase by the Fed, interest rates remain low, allowing consumers access to both homeownership and financing on attractive terms.

In addition to the issues identified above, the incoming Presidential administration and congressional delegation may face additional hurdles in advancing comprehensive legislative initiatives to pare back Dodd-Frank. As the post-election environment cools and the country marches towards inauguration day, the financial services industry can only hope that clarity on the direction of the U.S. regulatory environment begins to emerge.

NY State Prepared to Increase Salary Level for Certain Overtime Exceptions

New York OvertimeProposed amendments to the New York State Wage Orders significantly increase the salary levels needed for employers to qualify for the executive and administrative exceptions under the New York Labor Law.

Last month, a US district court in Texas enjoined the US Department of Labor’s proposed revisions to regulations regarding exemption status under the Fair Labor Standards Act, which were scheduled to go into effect on December 1, 2016. In light of this injunction, there is no federal legal requirement at this time to increase the weekly salary for individuals to be exempt from overtime to the $913 per week that the new Regulations would have required under federal law. This injunction is being appealed, and employers should be prepared to act quickly in case the district court’s decision is overturned and the injunction lifted.

However, for New York employers, that is only half of the issue.

Employers in New York must also simultaneously comply with the state’s salary basis floor for the executive and administrative exceptions under the New York Labor Law (NYLL). That minimum is presently $675 per week or $35,100 per year. If that amount is not paid, employers cannot claim executive and administrative exception status under the NYLL regardless of the duties the individual performs, and such individuals will be eligible for additional compensation for hours worked over 40 per workweek even if they are exempt under federal law. The New York salary minimum is a mandatory pre-condition to be completely excepted from the state overtime requirements.

Moreover, proposed amendments will very likely increase these salary basis minimums for the executive and administrative exceptions effective December 31, 2016, with scheduled increases in subsequent years. Specifically, the New York State Department of Labor (NYSDOL) has amended the state’s Wage Orders to increase the salary threshold for the executive and administrative exceptions to $825 per week for large employers in New York City. If adopted, these regulations would amend the salary basis threshold in the NYSDOL’s Wage Orders covering the building services industry (12 N.Y.C.R.R. 141), miscellaneous industries and occupations (12 N.Y.C.R.R. 142), nonprofitmaking institutions (12 N.Y.C.R.R. 143), and hospitality industry (12 N.Y.C.R.R. 146). The inclusion of the miscellaneous industries Wage Order will extend these amendments to nearly all employers.

The public comment period on these proposed changes closed on December 3, 2016. If the proposed amendments are finalized by the NYSDOL, they would become effective on December 31, 2016.

Proposed Amendments to Salary Threshold for Executive and Administrative Exceptions

The proposed salary basis amendments contain different salary requirements based on an employer’s size and geographic location within New York State. Specifically, there are different salary requirements for “large employers” in New York City (employers with 11 or more employees), for “small employers” in New York City (employers with 10 or fewer employees), “downstate” employers (employers in Nassau, Suffolk, and Westchester counties), and employers in the “remainder of state” (employers outside of New York City, Nassau, Suffolk, and Westchester counties).

The below chart provides an overview of the proposed changes:


Large Employers (11 or more employees)


Small Employers (10 or fewer employees)

Employers in Nassau, Suffolk, and Westchester Counties Remainder of NY State Employers
Current (as of December 31, 2015) $675.00 per week $675.00 per week $675.00 per week $675.00 per week
On and after December 31, 2016 $825.00 per week $787.50 per week $750.00 per week $727.50 per week
On and after December 31, 2017 $975.00 per week $900.00 per week $825.00 per week $780.00 per week
On and after December 31, 2018 $1,125.00 per week $1,012.50 per week $900.00 per week $832.00 per week
On and after December 31, 2019 $1,125.00 per week $975.00 per week $885.00 per week
On and after December 31, 2020 $1,050.00 per week $937.50 per week
On and after December 31, 2021 $1,125.00 per week

Effective Date

The effective date of the proposed amendments is December 31, 2016. While it is possible that the NYSDOL will withdraw or change the amendments before this date, it is more likely that they will be adopted without alterations and become effective on December 31, 2016.

Recommended Next Steps

In light of the increase in the salary threshold for the executive and administrative exceptions, employers should quickly identify and evaluate positions compensated below the new threshold and decide whether to reclassify employees as eligible for overtime under state and/or federal law, or raise their salaries. Employers should consider the hours worked for these employees to estimate the potential cost of paying overtime.

For those employees who will be reclassified as overtime eligible, employers should prepare talking points for managers and employees about the change, the reason for the change, and how the change will impact their compensation, benefits, and opportunities for advancement, if at all. Employers should also develop training and robust time reporting policies for reclassified workers who will not be accustomed to recording hours worked.

To the extent that reclassified employees previously were receiving bonuses, commissions, or other incentive compensation, employers will need to reevaluate those forms of compensation or carefully consider how to factor them into the regular rate of now-hourly workers. Employers should also be prepared to follow up and audit timekeeping practices for newly reclassified employees to ensure that they are following proper processes and procedures.

Copyright © 2016 by Morgan, Lewis & Bockius LLP. All Rights Reserved.

Los Angeles Enacts ‘Ban the Box’ Legislation

ban the box Los AngelesLos Angeles is the latest in a growing list of jurisdictions to adopt an ordinance restricting employers from asking a job applicant about his or her criminal history during the application process also known as “Ban the Box”. Under the Ordinance, private employers with at least 10 employees will be barred from inquiring about a job applicant’s criminal history until a conditional offer of employment has been made.

The “Los Angeles Fair Chance Initiative for Hiring (Ban the Box),” signed by Mayor Eric Garcetti on December 9, 2016, goes into effect on January 22, 2017.

Los Angeles has taken a different approach than San Francisco, the other California city to have adopted a “ban the box” ordinance affecting private employers. For example, the San Francisco ordinance, enacted in 2014, restricts questions about applicants’ criminal records on applications for employment and generally prohibits any type of criminal history inquiry until after the initial job interview. (For details, see our article, San Francisco Enacts ‘Ban the Box’ Law.) The Los Angeles ordinance prohibits employers from inquiring about criminal histories until a conditional job offer has been made.


An applicant for employment is broadly construed to include any individual who submits an application or other documentation for employment for work performed in the City, whether for full- or part-time work, contracted work, contingent work, work on commission, temporary or seasonal work, or work through an employment agency. It also includes any form of vocational or educational training, with or without pay.


An employer is defined as any individual, firm, corporation, partnership, labor organization, group of persons, association, or other organization that is located or doing business in the City and employs at least 10 employees.

The Ordinance does not apply to the City of Los Angeles or another local, state, or federal government unit.


Under the Ordinance, employers are prohibited specifically from inquiring into or seeking a job applicant’s criminal history before a conditional offer has been made. This broadly precludes employers from:

  1. asking any question on a job application about an applicant’s criminal history;

  2. asking about or requiring disclosure of the applicant’s criminal history during a job interview; or

  3. independently searching the internet for criminal conviction information or running a criminal background check before a conditional offer of employment has been made.

Criminal history is defined as information regarding any felony or misdemeanor conviction from any jurisdiction for which the person was placed on probation, fined, imprisoned, or paroled.


The four common-sense exceptions to the prohibitions are where:

  1. an employer is required by law to run a criminal background check on an applicant to obtain information on an applicant’s conviction;

  2. the job sought requires the possession or use of a gun;

  3. a person who has been convicted of a crime is prohibited by law from holding the position sought; and

  4. an employer is prohibited by law from hiring an applicant who has been convicted of a crime.

Fair Chance Process

If, after a conditional offer of employment has been made, an employer enquires into an applicant’s criminal history and determines the information warrants an adverse action, it must follow a “Fair Chance Process.”

Prior to taking any adverse action against an applicant, the employer must:

  1. perform a “written assessment” that links the specific aspects of the applicant’s criminal history with the risks inherent in the duties of the position sought. In performing the assessment, an employer must “at a minimum,” consider the factors identified by the Equal Employment Opportunity Commission (e.g., conduct an individualized assessment) and follow any rules and regulations that may be issued by the Designated Administrative Agency (“DAA”) responsible for enforcement;

  2. provide the applicant with written notification of the proposed action, a copy of the written assessment, and any other information or documentation supporting the employer’s proposed adverse action;

  3. wait at least five business days after the applicant is informed of the proposed adverse action before taking any adverse action or filling the employment position; and

  4. if the applicant provides the employer with any information or documentation pursuant to the Fair Chance Process, the employer must consider that information and perform a “written reassessment” of the proposed adverse action. If the employer still elects to take the adverse action after such reassessment, it must notify the applicant of the decision and provide the applicant with a copy of the written reassessment.

Employers using a consumer reporting agency to conduct their criminal background checks, should proceed with the Fair Chance Process concurrently with the pre-adverse and adverse action requirements of both federal and state Fair Credit Reporting Act laws.

Recordkeeping, Notice

Employers must retain documents related to applicants’ employment applications and any written assessment and reassessment performed for three years.

The Ordinance’s notice and posting requirements provide that employers must state in all job advertisements and solicitations for employment that they will consider for employment qualified applicants with criminal histories “in a manner consistent with the requirements of this [Ordinance].”

To notify applicants of the Ordinance, an employer must post a notice about the law in a conspicuous place at every workplace, job site, or other City location under the employer’s control and visited by applicants. In addition, a copy of the notice must be sent to the appropriate labor unions.


The Ordinance makes it unlawful for an employer to take any adverse employment action against any employee for complaining to the City about the employer’s compliance or anticipated compliance with the Ordinance, for opposing any practice made unlawful by the Ordinance, for participating in proceedings related to this Ordinance, or for seeking to enforce or assert his or her rights under the Ordinance.

Civil and Administrative Enforcement

The law allows an individual to bring a civil action for violation of the Ordinance. However, as a prerequisite to pursuing a civil action against an employer, the individual first must report an administrative complaint to the DAA (Department of Public Works, Bureau of Contract Administration) within one year of the alleged violation.

Beginning July 1, 2017, the DAA may fine employers up to $500 for the first violation, up to $1,000 for the second, and up to $2,000 for the third and subsequent violations of the law. However, fines for violations of the record-retention and notice and posting requirements are capped at $500 for each violation. Prior to July 1, 2017, the DAA will not issue any monetary penalties. Instead, it will issue written warnings to employers that violate the Ordinance.

A civil lawsuit may be brought against the employer, but only after the alleged violation has been reported to the designated administrative agency and the administrative enforcement process has been completed or a hearing officer’s decision has been rendered, whichever is later. The DAA still needs to establish rules governing the administrative process for investigation and enforcement of alleged violations.

All covered Los Angeles employers should communicate and train their managers who are involved in the hiring process about the Los Angeles Fair Chance Initiative for Hiring (Ban the Box) ordinance and take steps to ensure compliance with its restrictions

Jackson Lewis P.C. © 2016

January 25-27: 24th Annual Marketing Partner Forum – Client Collaboration & the New Rules of Engagement

In January 2017, Marketing Partner Forum returns to Terranea Resort in Rancho Palos Verdes, CA for a three day summit on law firm marketing and business development set against the breathtaking Southern California shoreline. Marketing Partner Forum will welcome law firm marketing partners, rainmakers, practice group heads, business development leaders and esteemed corporate counsel for a dynamic and vibrant conference designed for the industry’s most experienced professionals.

Call to register: 1-800-308-1700

Or click here to email and we will contact you.

For more information, click here.

Terranea Palos Ranchos Verdes Marketing Partner ForumWhy You Should Attend

Marketing Partner Forum is designed for client development partners, rainmakers, and the senior-most legal marketing and business development professionals across the legal industry. Our content reflects the experience and sophistication of our international audience in terms of rigor, ambition and scope. Attendees can expect to hear from venerable thought leaders both within and outside of the legal industry. Enjoy ample networking opportunities and the stunning scenery, golf course, spa and hiking trails at one of California’s most picturesque resorts. Take advantage of our brand new Marketing Partner Conference Track consisting of several compelling sessions designed specifically for the law firm partnership. Interact directly with senior clients and network for new business. Explore the brand new Marketing Partner Forum Technology Fair. Bring your family to our Thursday night reception and Friday Bloody Mary Brunch. Depart the event with practical takeaways to share with peers and firm leadership.

Law Firm Business Development: How to Stop Procrastinating

law firm business development procrastinatingMany of my clients procrastinate doing the hard work of business development.  Time, fear, not knowing where to start or something else seems to tie them in knots and prevent action. As a law firm business development consultant and coach, part of my job is to help my coaching clients understand the underlying reason for their business development procrastination so we can attack the problem together and move forward.

When working with procrastination issues, I often use something called the Zeigarnik effect to help people get started. You can use this tool to overcome procrastination in a variety of settings. At its core, the method can be reduced to a simple phrase: “Take the first step.”

In his recent book 59 Seconds: Think a Little, Change a Lot, Richard Wiseman tells the story of a young Russian psychology graduate student named Bluma Zeigarnik, who was seated at a café in Vienna in the 1920s observing the behavior of waiters. She noticed that the waiters had the ability to remember details of multiple food orders without writing themdown. They retained this information until each check was paid. When queried after the check was paid, they struggled to remember items on the order.

Zeigarnik’s study led her to conclude that starting a task creates a sort of psychic need or anxiety to complete what was started. If you begin and are then interrupted, the mind creates a way for you to remember what is necessary and pesters you until you’ve completed it.

The theory is often applied to students. Those who suspend their studies briefly and undertake alternative activities (studying other subjects, playing foosball, etc.) tend to remember material better than do those who don’t take a break.

Psychologist Jeremy Dean posits that procrastination is most crippling when we are faced with a large task and don’t feel we have all the information to start. Lack of business development training hampers lawyers because they don’t know where to begin and desperately don’t want to fail. What the Zeigarnik effect teaches, as Dr. Dean points out, is that one way to beat procrastination is simply by starting whatever you’ve been avoiding. Just start somewhere. Don’t attempt the hardest part first. Pick something trivial and easy, such as making a list or meeting with a coach or making a phone call. Once you’ve made a start, however trivial, you’ll want to finish to allay the anxiety you feel around not having completed the task.

We use the Zeigarnik effect as a tool in our workshops by requiring participants to write down the names of people with whom they know they should be in touch. Try it right now. Write down a list of people you really ought to be keeping in touch with but haven’t reached out to in the past six months. Keep it on your desk and then go back to the rest of your day. Perhaps making the list will create the anxious mind you need to stay on task.

Content copyright 2016 LawVision Group LLC All rights reserved.

Happy New Year Begins with Legitimate, Transparent and Trustworthy Media

fake newsIt used to be that news traveled fast, but these days, thanks to technology and social networking, it’s more accurate to say that news travels at record speeds. A news story can literally go viral in seconds. Unfortunately, sometimes these stories are entirely false – and it took a highly contentious presidential election for much of America to realize the distressing and detrimental prevalence of fake news.

Sometimes fake news stories can be detected from a mile away, but sometimes they fool even the most perceptive of readers. As NPR notes here, “…the proliferation of fake news isn’t just the responsibility of the platforms used to spread it. Those who consume news also need to find ways of determining if what they’re reading is true.” What’s the primary indicator? An authentic news story originates from a reputable and substantiated news outlet.

As a marketing and/or legal professional, you must do your homework when a media opportunity arises. Similarly to recognizing bogus news stories, you need to use your best judgment to recognize when interview and byline opportunities are not worthwhile or authentic. Interviewing and writing require valuable time and effort, so you want to ensure that every endeavor will be time and effort well spent with a news organization that is authentic, trusted and relevant in your industry. Otherwise, results could be lackluster and even detrimental. As New Year’s resolutions and goals are being set, what better occasion than now to refresh our understanding of the fundamental indicators of quality, reliable and suitable media opportunities?

The next time you are presented with a media opportunity, spend a few moments conducting some simple due diligence. When an opportunity arises, both for my clients and myself, I examine the following to weigh its value:

  • Website: Reputable and established news organizations run websites that are professional in esthetic and content. They have recognizable domains. Their sites are navigable, attractive and well-organized. They feature up-to-date news items. Ultimately, you need to ask yourself whether you want your name, commentary or original thought leadership to appear on that organization’s page. If the answer is no, then it’s definitely better to pass and hold out for the next opportunity.

  • Media Kit: Media kits are truly a treasure trove of information. They provide details such as a publication’s history, circulation, page views, editorial calendar and – perhaps most importantly – the audience. Who and how many will be exposed to your efforts? If the audience is not ideal for your message, or if numbers appear low, then you should set your sights on a different and more valuable opportunity.

  • Editor or Journalist Background: You can tell a lot about a media professional just by examining his or her professional history and repertoire of work. The beauty of media is that everything is documented. Where did he or she come from? Does the interviewer have established credentials with respected publications? What is his or her writing style – snarky and negative, or sound and informative? What other types of sources do they tend to quote in articles? Reporters are trained to find the story, so if you open yourself up to an interview, you need to make sure that it’s a “story” with no negative repercussions for you, your practice or your firm. Don’t be afraid to ask questions about the angle or direction your interviewer plans to take for his or her piece.

  • Cost: My clients often ask us about pay-to-play media opportunities. Generally speaking, my agency advises against pay-to-play. While advertising most definitely has its place, I strongly encourage and believe in conventional editorial opportunities that are gained through traditional PR methods.

  • Social Media Feeds: Who and what are the organizations/journalists following on social media? As the old adage goes, you are the company you keep. Even digitally! Reputable outlets and media professionals subscribe to other professional feeds.

For 2017, I challenge you to embrace this resolution: Support, read, share and contribute nothing but quality, enriching and authentic news. You, your clients and your colleagues will all reap the benefits. Your time is just that: yours. Make sure it’s spent reading and investing in nothing but the best.

ARTICLE BY Bethany S. Early of Jaffe

© Copyright 2008-2016, Jaffe Associates

DOJ Releases its 2016 False Claims Act Recovery Statistics

DOJ False Claims actOn Wednesday, the Department of Justice (DOJ) released its annual False Claims Act (FCA) recovery statistics, which revealed that Fiscal Year 2016 has been another lucrative year for FCA enforcement.  Based on these statistics, DOJ recovered more than $4.7 billion in civil FCA settlements this fiscal year — the third highest annual recovery since the Act was established.  Since 2009 alone, the government has recovered $31.3 billion in FCA settlements and judgments.  This is a truly staggering statistic.  It shows that the government’s reliance on the FCA to combat fraud will continue for the foreseeable future.

The healthcare and financial industries represent the largest portions of this year’s FCA recoveries.  In the healthcare industry alone, DOJ recovered a total of $2.5 billion based on federal enforcements.  DOJ also touted its instrumental role in assisting states recovering funds overpaid under state Medicaid programs.  From the financial industry, the government collected another $1.7 billion, largely as a result of enforcement actions arising from alleged false claims in connection with federally insured residential mortgages.

The number of new FCA matters through both qui tam and non-qui tam actions has increased since last year.  Interestingly, however, the statistics indicate that the share of settlements and judgments for relators declined—the percentage of the total recoveries from qui tam suits decreased from 80.7% in 2015 to 61% in 2016.  Most significantly, the percentage of recoveries for cases where the government declined to intervene decreased from 31% to 2.2% since last year.  Although the cause for this decline is uncertain, one could argue that this indicates that DOJ views the assistance of relators as less valuable in recent years.

Notwithstanding the specific observations related to the industries and types of actions resulting in recoveries this fiscal year, the statistics demonstrate that the FCA remains a powerful tool for the government’s fraud deterrence efforts.

Copyright © 2016, Sheppard Mullin Richter & Hampton LLP.