Category: Administrative & Regulatory

Gaga for Gigabit: The FCC (Federal Communications Commission) Liberates 100 MHz of Spectrum for Unlicensed Wi-Fi

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On April 1, the FCC took steps to remedy a small but growing annoyance of modern life:  poor Wi-Fi connectivity.  Removing restrictions that had been in place to protect the mobile satellite service uplinks of Globalstar, and by unanimous vote, the FCC’s First Report and Order on U-NII will free devices for both (i) outdoor operations; and (ii) operation at higher power levels in the 5.15 – 5.25 GHz band (also called the U-NII-1 band).1 The Report and Order also requires manufacturers to take steps to prevent unauthorized software changes to equipment in the U-NII bands, as well as to impose measures protecting weather and other radar systems in the band.

The practical impact of these rule changes is difficult to overstate.  By removing the operating restrictions in the U-NII-1 band, the FCC essentially doubled the amount of unlicensed spectrum in the 5 GHz band available to consumers.  In the near future, use of this spectrum will help to alleviate congestion on existing Wi-Fi networks, especially outdoor “hotspots” typically used at large public places like airports, stadiums, hotels and convention centers.  Two less-obvious, longer-term benefits also are worth watching.

First, the new IEEE 802.11ac standard for Wi-Fi was finalized in January 2014.  This next generation Wi-Fi standard is capable of delivering vast increases in raw throughput capacity to end-users, often approaching the holy grail of transfer speeds: 1 gigabit.  To achieve those speeds, wide channels of operation are required – channels that simply were not available to Wi-Fi devices.  Now that the U-NII-1 band has been unleashed for Wi-Fi usage, there should be little impediment to the near-term rollout of 802.11ac compatible devices.

This new standard will offer marked improvements in download speeds and streaming quality, and be a boon to consumers who increasingly rely on mobile devices for bandwidth intensive applications such as HD video.  Unsurprisingly, cable operators in particular are excited by the possibilities of this technology; on the day the Report and Order was released, Comcast Chief Technology Officer Tony Werner authored a lengthy blog post touting the possibilities of Comcast offering Gigabit Wi-Fi to its customers utilizing the U-NII-1 band.[2]

Second, in addition to the untempered enthusiasm of the MSOs, wireless carriers also have a stake in this unlicensed spectrum.  Specifically, as use of licensed mobile spectrum continues to expand exponentially, the wireless carriers will increasingly encourage wireless offloading as a means of addressing congestion and capacity issues on macro cellular networks.  For example, Cisco Systems estimates that 45% of global mobile data traffic was offloaded onto the fixed network through Wi-Fi or small cells in 2013.[3]

This transformation of 100 MHz of spectrum in the U-NII-1 band marks one part of a renewed focus on consumer broadband at the FCC.  In addition to unlicensed Wi-Fi, the FCC is also in the middle of a proceeding – covered in an earlier FCC Law Blog post[4] – to streamline rules for wireless infrastructure.  Taken together with the FCC’s release earlier this week of auction rules for 65 MHz of AWS-3 spectrum later this year, it becomes clear that although it is early yet, the Wheeler Commission is gaga for broadband.

[1] U-NII is the acronym for “Unlicensed National Information Infrastructure devices”, unintentional radiators which facilitate broadband access and wireless local area networking, including Wi-Fi.  A copy of the First Report and Order is available here.

[2] See Tony Werner’s blog post here.

[3] See Global Mobile Data Traffic Forecast Update, 2013-2018.

[4] See Sleeper “Small” Cells: The Battle Over The FCC’s Wireless Infrastructure Proceeding.

Article By:

Douglas A. Svor
Dave Thomas
Of:
Sheppard, Mullin, Richter & Hampton LLP

 

 

Revitalized National Labor Relations Board (NLRB) Takes on Vigorous Agenda Including Reissued Quickie Union Election Rules And Greater Employee Handbook Scrutiny

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The National Labor Relations Board (“NLRB” or the “Board”) has been notably active in the first quarter of 2014.

As addressed in our March 2013 Alert, the Board faced uncertainty regarding its power to act following the January 23, 2013 decision in Noel Canning v. NLRB by the U.S. Court of Appeals for the District of Columbia Circuit. Noel Canning held that President Obama’s three recess appointments to the Board, made on January 4, 2012, were unconstitutional. Then, in August 2013, the NLRB received a full complement of five Senate-confirmed members.

While it has taken a few months for the Board to ramp up after the new members were sworn in, the newly invigorated NLRB is quickly making up for that time. For instance, the Board issued 19 decisions in January 2014 alone.

Below are summaries of certain significant NLRB developments from the first quarter of 2014:

NLRB Proposes Quickie Election Rules Again – Will Help Unions to Organize On February 5, 2014, the Board reissued proposed amendments to its existing rules governing union election procedures, new rules which it first proposed in2011. These rules will make union organizing easier by dramatically expediting the Union election process. In May 2012, the United States District Court for the District of Columbia had blocked the prior rules, holding that the NLRB lacked a quorum when it adopted those rules.

The new proposed rules, which the Board issued with a full quorum, would make several significant changes that would greatly benefit unions. The proposed rules would:

  • speed up union elections by ending the current practice of scheduling pre-election hearings within fourteen days from the petition filing and instead requiring hearings to be held within seven days of the filing;
  • substantially reduce an employer’s right to litigate whether employees are eligible to vote prior to an election, by automatically deferring such issues until after the election; and
  • require employers to provide union organizers with the names, addresses, email addresses and phone numbers of employees once a petition has been filed.
  • The NLRB is accepting public comments on the proposal until April 7, 2014. In addition, the Board will hold a public hearing on the proposed rules during the week of April 7, 2014.

NLRB Employee Handbook Scrutiny The Board has been more closely examining provisions in companies’ employee handbooks. This increased scrutiny impacts employers in both union and non- union workplaces.

As noted in our April 2013 Alert, several of the Board’s prominent decisions over the past few years have addressed social media policies. Recently, the NLRB has expanded its focus to other aspects of employer handbook policies, such as those policies pertaining to confidentiality, dispute resolution, at-will employment statements, and non-union statements.

A recent example is a decision issued by an NLRB Administrative Law Judge (“ALJ”) that partially invalidated an employer’s dress code. Boch Imports, Inc., NLRB, No. 1-CA-83551 (Jan. 13, 2014).

In Boch, the ALJ found that a dress code provision in a Honda dealer’s employee handbook that prohibited employees who have contact with the public from wearing pins, insignia, or other message clothing violated section 8(a)(1) of the National Labor Relations Act (“NLRA” or the “Act”) (which prohibits employers from interfering with employees as they engage in protected concerted activity). Although the dress code rule applied to all pins, insignia, or other message clothing, the ALJ found that the rule violated an employee’s presumptive right to display a union insignia in the workplace.

Notice Posting Rule Abandoned – But New Emphasis on Digital Media to Publicize NLRA’s Protections in Union and Non-Union Workplaces The Board has decided not to seek U.S. Supreme Court review of two U.S. Court of Appeals decisions which held that the NLRB’s Notice Posting Rule was invalid. The Notice Posting Rule would have required private employers to post a notice in the workplace of employee rights under the Act.

The Board has issued an update on its website stating that the NLRB remains committed to making sure that “workers, businesses and labor organization are informed of their rights and obligations under the National Labor Relations Act.” According to that update, the workplace poster is available on the NLRB website and may be disseminated voluntarily. The Board has also established a free mobile app for iPhone and Android users, which provides information about the NLRA.

Although the NLRB chose to abandon its proposed Notice Posting Rule, the Board’s subsequent statements and its use of digital media to disseminate information about the Act demonstrate a commitment to remain relevant, modernize, and seek to influence employees in both unionized and non-unionized workplaces.

Employer Take Aways

  • Employees must prepare for the new quickie election rules. Management must promote positive employee relations before union organizing occurs. Employers will no longer have the time to campaign fully against unionization once a labor organization files a petition.
  • Employers must be very mindful of the Board’s increased focus on non-union workplaces, including its scrutiny of employee handbook and social media policies.

The NLRA applies to virtually all private sector employers, whether unionized or not unionized. If the NLRB finds that a policy violates the NLRA, the Board may order that the employer rescind that policy and may also require management to post a notice to employees stating that the employer will not violate the Act. The NLRB may also invalidate any discipline or termination that the employer based on that policy and can require the reinstatement, with back pay, of any discharged employee.

  • The U.S. Supreme Court is still considering the Board’s appeal of Noel Canning, which may require the Board to revisit certain prior rulings. In the meantime, the NLRB is moving forward with its vigorous agenda.
Article By:

David I. Rosen
Galit Kierkut
Charles S. Zucker
Grace A. Byrd
Of:
Sills Cummis & Gross P.C.

Tri-Agency Health Information Technology Report Issued

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On Thursday, April 3rd, the three federal agencies charged with regulating components of health information technology (“Health IT”) issued their long-awaited Health IT Report: Proposed Strategy and Recommendations for a Risk-Based Framework (the “Report”).  The Report seeks to develop a strategy to address a risk-based regulatory framework for health information technology that promotes innovation, protects patient safety, and avoids regulatory duplication.

Congress mandated the development of the Report as part of the 2012 Food and Drug Administration Safety and Innovation Act, requiring the Food and Drug Administration (“FDA”), the Office of the National Coordinator for Health Information Technology (“ONC”), and the Federal Communications Commission (“FCC”) to coordinate their efforts to regulate Health IT.  Notably, the Report identifies and distinguishes between three types of Health IT: (i) health administration Health IT, (ii) health management Health IT, and (iii) medical device Health IT.

The recommendations in the Report include continued interagency cooperation and collaboration, the creation of a public-private safety entity—the Health IT Safety Center—and a risk based approach to the regulation of Health IT.  The Report emphasizes that the functionality of Health IT and not the platform for the technology (mobile, cloud-based, or installed software) should drive the analysis of the risk and the regulatory controls on Health IT.

In very good news for the Health IT community, the Report included a recommendation that, “no new or additional areas of FDA oversight are needed.”  The report emphasized that even if the functionality of health management Health IT meets the statutory definition of a medical device, the FDA will not focus its oversight attention in this area.  The Report gives additional guidance on clinical decision support (“CDS”) tools, clarifying that a number of CDS tools can be categorized as health management Health IT and do not require further regulation by FDA.  However, the Report noted that certain types of CDS tools that are currently regulated as medical devices by the FDA would continue to be so regulated.  These FDA-regulated CDS tools include computer aided detection and diagnostic software and robotic surgical planning and control tools.

The agencies intend to convene a public meeting on the proposed strategy within 90 days and to finalize the Report based on public input.

Of:

Ellen L. Janos

Kate F. Stewart
By:
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

U.S. Supreme Court Finds Aggregate Limits on Federal Campaign Contribution are Unconstitutional

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On April 2, 2014, the United States Supreme Court held in a 5-4 decision that aggregate contribution limits, those limits placed on an individual’s overall direct contributions during a two-year election cycle, were unconstitutional as a violation of the First Amendment. The case, McCutcheon v. Federal Election Commission, No. 12-536 (U.S. April 2, 2014), is the latest case in which the Supreme Court has loosened federal regulation of campaign contributions.

In a fractured decision, Chief Justice John Roberts authored a plurality opinion that struck down the aggregate limit as a “mismatch” between the government’s goal of curbing corruption and its chosen means of imposing an aggregate limit. Although the government has a valid interest in limiting quid pro quo corruption between contributors and elected officials, the Court explained, an aggregate limit imposed across all candidates does not limit the risk of corruption enough to justify the way it significantly limits the right to support candidates in an election. In the face of core First Amendment guarantees, the aggregate limit could not survive because it was not “closely drawn to avoid unnecessary abridgment of associational freedoms.” Slip opinion at 30 (citation omitted).

The Chief Justice was joined by three of his colleagues: Justices Antonin Scalia, Anthony Kennedy, and Samuel Alito. Justice Clarence Thomas wrote separately to say that he would both strike down aggregate limits and overturn key Supreme Court precedent sanctioning a wide array of campaign finance restrictions.

The Dissent

Writing for the four Justices in dissent, Justice Stephen Breyer argued that aggregate campaign contribution limits had been previously held to be constitutional and that the reversal of existing precedent will come at a grave cost to the U.S. political system. In his view, the decision of the plurality “undermines, perhaps devastates, what remains of campaign finance reform.” Slip opinion at 30 (Breyer, J., dissenting). Justice Breyer was joined by Justices Ruth Bader Ginsburg, Sonia Sotomayor, and Elena Kagan.

Unchanged Rules

Prior to today’s decision in McCutcheon, campaign contributions were subject to two key limitations. The first limit, which remains intact, is the base limit on individual contributions to a single campaign, party committee, or political action committee. That limit remains unchanged, thus there is still a limit of $2,600 that an individual may contribute to a candidate for each election in the two year election cycle. As a result, one may contribute $2,600 for a primary election, $2,600 for a general election, and an additional $2,600 if there is a runoff election. Limits on contributions to other committees may be seen on the below chart.

In addition, the decision has no impact on the operation of a Super PAC, otherwise known as an “independent expenditure-only committee.” Nor does the decision permit corporations to make contributions to federal candidate committees.

New Rule

The limit that was struck down today restricted the overall amount individuals can contribute to election campaigns during a given two-year election cycle. Those aggregate limits were most recently set at $48,600 for federal candidates and $74,600 for other political committees, including national and state party committees, for an overall limit of $123,200 per two-year cycle. As such, prior to this decision a person could give the maximum base contribution of $5,200, for both a primary and a general election, to a maximum of nine federal candidates, whereas now a person can contribute to all federal candidates if she so desires. Similarly, an individual may now contribute to as many PACs as desired, including state and federal committees, such as the Democratic National Committee and the Republican National Committee, as long as each contribution is within the base limit currently set at $32,400 for the national party committees.

In viewing the below chart from the Federal Election Commission, the box in the upper right corner, under Special Limits, has been eliminated. All the other listed limits continue to be the federal legal limits.

Kedar Bhatia contributed to this article.

Article By:

Laurence A. Levy
Of:
Bracewell & Giuliani LLP

 

California Proposes Enhanced Prop. 65 Warnings and Possible Online Disclosures – Dietary Supplements and Foods Specially Targeted

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The California Office of Environmental Health Hazard Assessment (OEHHA)announced on March 7, 2014, that it is considering implementation of the most significant changes to Prop. 65 regulations in more than two decades.  OEHHA has posted the draft regulation and Initial Statement of Reasons on its website.

Passed by voters in 1986, Prop. 65 requires warnings prior to exposures to chemicals listed by OEHHA as “known to the State” to cause cancer or reproductive harm.  The law, which carries the potential penalty of $2,500 for each violation, may be and routinely is enforced by entrepreneurial private plaintiffs who are permitted to bring legal actions against alleged violators with minimal evidence.  OEHHA’s proposed regulations will affect almost every industry subject to Prop. 65 and nearly every aspect of compliance.  In all but a few cases, OEHHA’s changes have the capacity to make compliance with Prop. 65 costlier, riskier, and more disruptive to companies doing business in California.

Four Important Provisions Affecting Food and Dietary Supplements

In its far-reaching proposal, OEHHA aims a number of significant changes directly at food and dietary supplement manufacturers, distributors, and retailers.  Four specific proposals stand out as impactful for the industry:

  1. Chemical Identification: Under OEHHA’s proposal, warning labels would have to specifically identify the chemical in question if it is on a proposed list of 12 “common” substances.  One substance on OEHHA’s list, lead, is sometimes naturally occurring in the ingredients used to produce dietary supplements and has been the source of considerable litigation and expense for the industry.  In OEHHA’s draft regulation, products requiring a warning for lead would have to “conspicuously” state its presence in the product.
  2. Display Requirements: For foods not already subject to a consent judgment, the “safe-harbor” warning language must also be enhanced with specific information about the chemical in question, specific text sizing, and the phrase “Cancer [and/or] Reproductive Hazard.” Even where a food supplier has data showing that the chemical poses no actual health threat, a private plaintiff may still litigate knowing that the costly burden of showing no significant risk is borne by defendants.  Unless modified or declared preempted by federal law, OEHHA’s regulation would virtually ensure that this language will be required for food and supplement packaging in California.
  3. Online Reporting: OEHHA would also mandate reporting of exposure data to the agency for its website if a new Prop. 65 warning does not contain 10 details specified by OEHHA.  The details include, among others, the name of the chemical at issue, anticipated exposure routes, exposure levels, and options for minimizing exposure.  Businesses that fail to provide the required detail, no matter how misleading it might be to the consumer, must disclose the additional information to OEHHA and will likely see such data published online.
  4. More Litigation: Despite statements from the agency to the contrary, OEHHA’s complex rules would encourage even more litigation from an already active community of plaintiffs.  OEHHA’s draft litigation reform, a “cure” or fix-it period for retailers with fewer than 25 employees, would do little to stem the current tide of lawsuits, the vast majority of which are ultimately directed at and defended by suppliers.  Additionally, by replacing the generic safe-harbor warning with specific requirements, a regulatory safe-harbor warning would no longer provide a safe harbor from liability or deter plaintiffs from alleging violations for exposures to unspecified or newly listed chemicals.

What You Can Do

Businesses which stand to be affected by OEHHA’s plans, including those operated out of state, have an opportunity to voice their concerns to the agency.

OEHHA will hold a public workshop on April 14, 2014 to discuss the proposed regulations.  In addition, OEHHA is accepting written comments from the public until May 14, 2014.  Unless OEHHA is convinced to delay or withdraw its plans, formal regulations will likely be proposed in the summer of 2014.

Because OEHHA’s proposals are currently in the preliminary stages, interested parties have a time critical opportunity to engage the agency and encourage it to address specific concerns.  Companies that manufacture distribute, or retail dietary supplements in California should consider retaining experienced counsel to analyze the impact of the proposals on their business and to participate in the public comment period on their behalf.   Given the potentially far-reaching consequences of the proposed changes on the individual companies and the industry at large, interested parties should be diligent in bringing their concerns to OEHHA as early and as persuasively as possible.

Article By:

James Mattesich
Justin J. Prochnow
Anthony J. Cortez
Greg Sperla
Of:
Greenberg Traurig, LLP

EPA’s Proposed Waters of the U.S. Rule: Does It Regulate Puddles? – Environmental Protection Agency

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In a leaked draft, EPA was seen to have been contemplating explicitly excluding puddles from regulation, but, in the end, didn’t do so. EPA provided an explanation as to why, but the rule is so broad, we think EPA’s explanation may not be completely relevant. In other words, because the rule is so broad, many puddles actually might fall under federal jurisdiction. The reason is the host of new definitions proposed by EPA. Previously undefined terms like tributary, neighboring, and floodplain are all now defined, and in a way that creates a web of federal jurisdiction. Here’s how:

  1. The rule starts with an initial list of jurisdictional areas, which includes (a) waters that are, have been, or could be used in interstate commerce, (b) interstate waters, and (c) the territorial seas.
  2. The rule then adds to this list all tributaries of these waters. Tributary gets defined for the first time as any feature with a bed and bank that contributes flow to any water on the initial list. Many features, like dry arroyos and mountain channels, have bed and bank even though they only flow when it rains or the snow melts:
  3. The rule then continues, adding to the list of jurisdictional waters all waters that are adjacent to the initial waters and their tributaries. Adjacent is “bordering, contiguous or neighboring.”
  4. EPA then defines neighboring for the first time to include any water in the floodplain or a riparian area of the initial waters and their tributaries. These also get new definitions. Floodplain is an area along a water, formed by sediment deposition and inundated during moderate to high flows. Riparian area is one bordering any water where surface or groundwater “directly influence the ecological processes and plant and animal community structure in that area.”

The end result is that areas are jurisdictional, as far upstream as one can find a bed and bank, and as far outward from that bed and bank as the area “directly influences” the area’s ecology or is formed by sediment and gets inundation from high flows. That is a lot of area. To give you a sense of the potential breadth of areas “subject to inundation,” this map shows in blue the flooding along the Mississippi River in 2011 and the counties/parishes at risk of significant flooding:

Fully one-third of Arkansas was covered. One half of the counties in Illinois were at risk.

This brings us back to puddles. In the proposal’s preamble, EPA says it removed puddles from the “not jurisdictional” list for clarity, not to imply they are jurisdictional.

Some puddles, it says, are not jurisdictional. The language of the rule, however, suggests that puddles are arguably jurisdictional if they are in floodplains or riparian areas. The fact that puddles aren’t always wet may not be decisive: EPA considers streams which flow only when it rains or snow melts to be jurisdictional and identifies dry features as “water”:

We’re not saying that EPA would take the position that puddles are jurisdictional – our only point is that the language of the proposed rule is so broad that it could. And we haven’t even started on the “significant nexus” test.

This is the second in a series of posts regarding EPA’s proposed rule redefining “waters of the United States” under the Clean Water Act.

For Part One, click here.

Photo credits, from top: Photo of the Las Cruces Arroyo from Wikipedia. Mississippi River map from the US Census Bureau. Photo of a wetland from the Arid West Region Regional Supplement to the Corps’ Wetland Delineation Manual.

Article By:

Lowell M. Rothschild
Of:
Bracewell & Giuliani LLP

Mind Regulations When It Is Time To Mine

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The Department of Labor recently issued a reminder to employers involved in themining industry. As spring (slowly) approaches, surface mines will reopen. As miners head back to the job site and prepare equipment for the new season, potential for injury is high.

Of the 12,000 metal and nonmetal mines overseen by the Mine Safety and Health Administration (“MSHA”), almost half are operated on a seasonal basis, closing for winter when conditions make operations too difficult. According to MSHA information, injuries at seasonal mines climb sharply in the spring. MSHA is vested with the power to enforce compliance with mandatory safety and health standards as a means to eliminate fatal accidents; to reduce the frequency and severity of nonfatal accidents; to minimize health hazards; and to promote improved safety and health conditions in the Nation’s mines.

Miner operators and managers should review safety information available at http://www.msha.gov and take the time to educate employees on the numerous hazards associated with the job. Always keep in mind that employers are responsible for providing a safe workplace; employee injuries are not only detrimental to operations, but can be costly – both financially and reputation-wise.

Article by:
Brandon K. Johnson
 
Of:
McBrayer, McGinnis, Leslie and Kirkland, PLLC

U.S. Supreme Court Clarifies That Severance Pay is Taxable—in Most Cases

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On Tuesday, March 25, 2014, the U.S. Supreme Court, in an 8-0 decision, ruled that severance payments made to employees who are involuntarily terminated are taxable wages under the Federal Insurance Contributions Act (FICA).  Quality Stores, Inc., et al., 12-1408.  The Court reversed the Sixth Circuit Court of Appeals ruling in favor of Quality Stores, which was seeking a $1 million tax refund based on its argument that severance payments were not covered by FICA and were excluded from taxation based on the Internal Revenue Code.  The Court’s ruling resolved a split between the Sixth Circuit and the Federal Circuit, and ended a legal battle with more than $1 billion at stake in potential tax refunds to employers involved in 11 separate cases with more than 2,400 refund claims.

Quality argued that its severance payments to terminated employees were actually supplemental unemployment compensation benefits (SUB), which are not considered “wages” under the Internal Revenue Code.  According to the company, “a SUB payment is a type of payment that—although made by an employer to [its] former employee—nonetheless does not meet the statutory definition of ‘wages’ because it is not remuneration for services.”  The Court noted that the severance payments were made only to employees and were based on employment-driven criteria including the position held, the employee’s length of service with the company and salary at the time of termination.  Relying on the “broad definition of wages under FICA,” the Court ruled that severance payments to employees who are terminated involuntarily are taxable under FICA.

However, in its decision the Court noted IRS revenue rulings that severance payments tied to the receipt of unemployment compensation benefits “are exempt not only from income tax withholding but also FICA taxation.”  Thus, employers appear to continue to be able to make severance payments not taxable through a carefully crafted structure linking the severance payments to the employee’s receipt of unemployment compensation benefits.

Article By:

Mark D. Nelson
Alejandra Lara
Of:
Drinker Biddle & Reath LLP

Northwestern Scholarship Football Players Found to be Employees Eligible for Union Representation

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Peter Sung Ohr, the Regional Director for Region 13 of the National Labor Relations Board issued a Decision and Direction of Election pertaining to the effort of the Northwestern University football players to unionize. The Regional Director found that scholarship football players at Northwestern University are “employees” within the meaning of the National Labor Relations Act and eligible for union representation. The Regional Director found appropriate a bargaining unit composed of “all football players receiving a grant-in-aid football scholarship and not having exhausted their playing eligibility.”

The Regional Director used the common law definition of employee in reaching his decision. Under the common law test, a person is an employee if he performs a service for another, under a contract of hire, for compensation, and is subject to the other’s right of control. He found the following:

  • The scholarship football players perform a service (playing football) for compensation (a scholarship)
  • The scholarship players’ commitments to play football in exchange for the scholarship constitutes a contract for hire
  • The scholarship players are under the control of the University for the entire year, including in-season and out-of-season workouts, restrictions on their entire personal life and detailed regulations players must follow at the risk of losing their scholarship

The Regional Director decided the NLRB’s 2004 Brown University decision, in which the NLRB found graduate assistants not to be employees of the university, to be inapplicable here because playing football is not part of the players’ academic degree program. However, he wrote that even if the Brown University test was applied, the scholarship football players would be found to be employees. He noted:

  • The scholarship players are not primarily students due to the 50-60 hours a week during the season that they devote to football
  • The scholarship players’ football “duties” do not constitute a part of their academic degree requirements
  • The academic faculty does not supervise the players’ football duties; rather, coaches who are not part of the faculty do so
  • The grant-in-aid football scholarship is not need-based like the financial aid other students receive but is given solely in exchange for playing football

The Regional Director rejected two additional arguments made by the University:

  • He decided the scholarship football players are not “temporary employees” (who are generally ineligible to participate in collective bargaining) because they work more than 40 hours a week during the season, work year round, expect to work for 4-5 years and play football as their prime consideration
  • He did not include the “walk-on” players in the bargaining unit. He found that they are not employees within the meaning of the NLRA because they do not receive a scholarship and are not subject to the conditions for its receipt

The University now has until April 9, 2014 to file a Request for Review to appeal the Regional Director’s ruling to the NLRB in Washington, D.C.

Article By:

Gregg E. Clifton
Paul V. Kelly
Of: 
Jackson Lewis P.C.

EEOC Sues Wal-Mart Stores East for Disability Discrimination – Equal Opportunity Employment Commission

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Cockeysville Store Refused to Accommodate Applicant With End-Stage Renal Disease, Federal Agency Says

Wal-Mart Stores East, LP violated federal law when it refused to employ an individual with end-stage renal disease as a store associate because she needed a reasonable accommodation during the hiring process, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a federal lawsuit it announced today.

The EEOC charges that following a successful interview, the assistant store manager at the Walmart store in Cockeysville, Md., offered Laura Jones a job as an evening sales associate, contingent on passing a urinalysis test for illegal drugs.  When Jones said that she cannot produce urine because she has end-stage renal disease, the assistant store manager told her to ask the designated drug testing company about alternate tests.

That day, Jones went to the drug testing facility as directed and was told that while the facility did offer other drug tests, such as a mouth swab/saliva test, the employer had to order the alternate drug test.  Jones then called the assistant store manager, relayed this information and even offered to pay for an alternate test if Wal-Mart would order it.  Instead of ordering an alternative drug test as a reasonable accommodation to Jones’s disability, the EEOC charges that the assistant store manager replied that she had “called the corporate office” and that Jones could not be hired if she did not pass a urinalysis test.  Jones’s application was closed for failing to take a urinalysis within 24 hours.

Such alleged conduct violates the Americans with Disabilities Act, which requires employers to provide a reasonable accommodation, including during the application and hiring process, unless it can show it would be an undue hardship.  The ADA also prohibits employers from refusing to hire individuals because of their disability.

The EEOC filed suit (EEOC v. Wal-Mart Stores East, LP, Civil Action No. 1:14-cv-00862-JKB) in U.S. District Court for the District of Maryland, Baltimore Division, after first attempting to reach a voluntary pre-litigation settlement through its conciliation process.  The EEOC seeks injunctive relief prohibiting Wal-Mart from discriminating based on disability, equitable relief that provides equal employment opportunities for individuals with disabilities, and lost wages, compensatory and punitive damages and other affirmative relief for Jones.

EEOC Philadelphia Regional Attorney Debra M. Lawrence pointed out that this is the third lawsuit the EEOC has filed in the last year against employers who refused to provide alternative drug tests, such as a saliva test or blood test, to applicants who requested and needed that reasonable accommodation.  The other lawsuits involving this issue are EEOC v. Kmart Corporation; Sears Holdings Management Corporation; Sears Holding Corporation, filed in U.S. District Court for the District of Maryland (Civil Action No. 13-cv-02576) and EEOC v. Fort Worth Center of Rehabilitation, filed in U.S. District Court for the Northern District of Texas (Civil Action No. 3:13-cv-1736).

“While an employer may require applicants to undergo a drug test, these lawsuits should send a strong message to all employers that they simply cannot have a blanket, inflexible policy or practice of requiring only a urinalysis test, regardless of the circumstances,” said Lawrence.  “Paying attention to federal disability law and making a minimal effort to accommodate this applicant would have saved everyone a lot of trouble.”

EEOC Philadelphia District Director Spencer H. Lewis, Jr. added, “Wal-Mart evidently thought Ms. Jones was qualified for the position because it made her a job offer.  When it refused to permit her to take an alternative drug screening test and revoked the job offer, the company lost the talent and services of a qualified employee as well as violating federal law.”

The EEOC enforces federal laws prohibiting employment discrimination.  Further information about the Commission is available at its website, www.eeoc.gov.  The Philadelphia District Office of the EEOC oversees Pennsylvania, Maryland, Delaware, West Virginia and parts of New Jersey and Ohio.

Article by:

U.S. EEOC