Category: Labor & Employment

California Court of Appeal Rules that Challenge to Google’s Confidentiality Agreements May Proceed Past the Pleading Stage

On September 21, 2020, in a published 2-1 opinion in Doe v. Google Inc., the California Court of Appeal (Dist. 1, Div. 4), permitted three current and former Google employees to proceed with their challenge of Google’s confidentiality agreement as unlawfully overbroad and anti-competitive under the California Private Attorneys General Act (“PAGA”) (Lab. Code § 2698 et seq.).  In doing so, the Court of Appeal reversed the trial court’s order sustaining Google’s demurrer on the basis of preemption by the National Labor Relations Act (“NLRA”) (29 U.S.C. § 151 et seq.) under San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244–245 (1959).  The court held that while the plaintiffs’ claims relate to conduct arguably within the scope of the NLRA, they fall within the local interest exception to Garmon preemption and may therefore go forward.  It remains to be seen whether plaintiffs will be able to sustain their challenges to Google’s confidentiality policies on the merits.  However, Doe serves as a reminder to employers to carefully craft robust confidentiality agreements, particularly in the technology sector, in anticipation of potential challenges employees may make to those agreements.

Google requires its employees to sign various confidentiality policies.  The plaintiffs brought a lawsuit challenging these policies on the basis that they restricted their speech in violation of California law.  Specifically, the plaintiffs alleged 17 claims that fell into three subcategories based on Google’s confidentiality policies: restraints of competition, whistleblowing and freedom of speech.  The claims were brought under PAGA, a broad California law that provides a private right of action to “aggrieved employees” for any violation of the California Labor Code.  PAGA claims are brought on a representative basis—with the named plaintiffs deputized as private attorneys general—to recover penalties on behalf of all so-called “aggrieved employees,” typically state-wide, with 75% of such penalties being paid to the State and 25% to the “aggrieved employees” if the violation is proven (or a court-approved settlement is reached).

In their competition causes of action plaintiffs alleged that Google’s confidentiality rules violated Business & Professions Code sections 17200, 16600, and 16700 as well as various Labor Code provisions by preventing employees from using or disclosing the skills, knowledge, and experience they obtained at Google for purposes of competing with Google.  The court noted that section 16600 “evinces a settled legislative policy in favor of open competition and employee mobility” that has been “instrumental in the success of California’s technology industry.”  The plaintiffs complained that Google’s policies prevented them from negotiating a new job with another employer, disclosing who else works at Google, and under what circumstances the employee may be receptive to an offer from a rival employer.

With respect to their whistleblowing claims, the plaintiffs alleged that Google’s confidentiality rules prevent employees from disclosing violations of state and federal law, either within Google to their managers or outside Google to private attorneys or government officials in violation of Business & Professions Code section 17200 et seq. and Labor Code section 1102.5.  Similarly, it is alleged that the policies ostensibly prevented employees from disclosing information about unsafe or discriminatory working conditions, a right afforded to them under the Labor Code.

In their freedom of speech claims, plaintiffs alleged that Google’s confidentiality rules prevent employees from engaging in lawful conduct during non-work hours and violate state statutes entitling employees to disclose wages, working conditions, and illegal conduct under various Labor Code provisions.  The employees argued this conduct could be writing a novel about working in Silicon Valley or to even reassure their parents they are making enough money to pay their bills—i.e., matters seemingly untethered to a legitimate need for confidentiality.

While Google’s confidentiality rules contain a savings clause—confirming Google’s rules were not meant to prohibit protected activity—the plaintiffs argued that the clauses were meaningless and not implemented in its enforcement of its confidentiality agreements.

Google demurred to the entire complaint, and the trial court sustained the demurrer as to plaintiffs’ confidentiality claims, agreeing that the NLRA preempted such claims.

On appeal, the Court of Appeal recognized that the NLRA serves as a “comprehensive law governing labor relations [and] accordingly, ‘the NLRB has exclusive jurisdiction over disputes involving unfair labor practices, and “state jurisdiction must yield’ when state action would regulate conduct governed by the NLRA.  (Garmon, [supra, 359 U.S.] at pp. 244-245.)”  But the court cautioned that NLRA preemption under Garmon cannot be applied in a “mechanical fashion,” and its application requires scrutiny into whether the activity in questions is a “merely peripheral concern” of the NLRA or where the “regulated conduct touche[s] interests so deeply rooted” in state and local interests.

In analyzing the federal and state issues at state, the Court of Appeal found that several of the statutes undergirding plaintiffs’ PAGA claims did not sound in principles of “mutual benefit” that are the foundation of the NLRA but protected the plaintiff’s activities as individuals.  The court cited several examples, including Labor Code section 242 prohibition of employers preventing employees from disclosing the amount of his or her wages (a statute enacted to prevent sex discrimination) and Labor Code section 232.5, prohibiting an employee from disclosing information about the employer’s working conditions (manifesting California’s policy to prohibit restrictions on speech regarding conditions of employment).  The court likewise found that the NLRA did not protect much of the activity prohibited by the statutes that supported plaintiffs’ PAGA claims, noting that the NLRA did not prohibit rules inhibiting employees from seeking new employment and competing with Google, as plaintiffs alleged Google’s confidentiality rules did.  It further does not protect whistleblowing activity unconnected to working conditions, such as violations of securities law, false claims laws, and other laws unrelated to terms and conditions of employment.

Nevertheless, the court held that, regardless of diverging purposes of the NLRA and the laws that support the plaintiffs’ PAGA claims, plaintiffs’ claims fall squarely in the local interest exception to NLRA preemption.  Where an employer’s policies are arguably prohibited by the NLRA, the local interest exception to NLRA preemption applies when (1) there is a “significant state interest” in protecting the citizen from the challenged conduct, and (2) the exercise of state jurisdiction entails “little risk of interference” with the NLRB’s regulatory function.  The court found no difficulty in determining that an action under PAGA, where the plaintiffs are serving as a “proxy or agent of the state’s labor law enforcement agencies” grows from “deeply-rooted local interests” in regulating wages, hours, and other terms of employment.  It also found that a state’s enforcement of its minimum employment standards, particularly in relation to the plaintiffs claims in this case, were peripheral to the NLRA’s purpose of safeguarding, first and foremost, workers’ rights to join unions and engage in collective bargaining.  Thus, the court held, there was no basis for NLRA preemption in this case.

Particularly in light of this opinion, employers who require employees to execute confidentiality agreements with their employees should be cognizant of the myriad of ways that they can be challenged.  As in the case of Doe v. Google, Inc., such challenges may not be just from individuals bringing claims in their own capacity, but as private attorneys general bringing representative claims on behalf of all California employees.  Nor can NLRA preemption be mechanically applied to preempt claims based upon such agreements.  Employers would be well-advised to review their existing confidentiality agreements and consult experienced counsel before revising or rolling out such agreements.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.
For more articles on labor law, visit the National Law Review Labor & Employment section.

Lawsuits for Illegal Strip Searches

DETROIT — Strip searches are routinely performed by law enforcement officers of all types. This ranges from police to prison guards, as well as to TSA agents at airports in the United States.

Private security guards also perform strip searches, including in malls and retail stores.

While some strip searches are legal, others violate the person’s constitutional rights. In general, people have a reasonable expectation of privacy.

A public officer or private guard cannot simply conduct a strip search without a proper legal basis. When an illegal strip search occurs, the victim can file a lawsuit seeking compensation for the violation of protected rights.

The basis for most illegal strip search lawsuits is a violation of the Fourth Amendment of the U.S. Constitution. The text of the Fourth Amendment states:

“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

The key words in the Fourth Amendment as it relates to an unlawful search are “unreasonable” and “probable cause.” Probable cause is a higher standard than reasonable suspicion. An officer does not have the right to search a person simply because there was a basis for stopping that person. In fact, most illegal strip searches are performed on people who are legitimately stopped or apprehended, but there is no legal basis to perform a subsequent search.

The main requirement is if the person being searched had a reasonable or legitimate expectation of privacy. Probable cause is required only when there is a reasonable expectation of privacy. When a search is disputed, what is “reasonable” is often determined by a judge or jury.

There are often even disputes as to what constitutes a strip search in the first place.

Different parties often have varying definitions of what constitutes a strip search. And, the context of each type of search may vary from one person to another.

For example, a prison guard performing a strip search may have one definition in mind that involves a physical search of the inmate’s body.  Others may have broader definitions as to what they define as a strip search.  Case law, both state and federal, have examined a variety of situations and fact patterns and their decisions form the basis of what is legal and what is not.

Some case law holds that complete nudity is required to be constituted as a strip search. Other cases hold that it is a lesser degree, and that a strip search can be illegal without the person being totally naked. There are many cases that also address the degree of the search itself and how invasive it is on the person being searched. This can vary on the type of crime suspected and the urgency to perform the search to preserve potential evidence against the person.

There have been many illegal strip search lawsuits filed throughout the United States. Most are based upon violations of the Fourth Amendment when asserted against a governmental agency, or person acting on behalf of the government. Other claims are brought under an invasion of privacy theory, and this theory is frequently used in cases against private individuals and entities.

In addition, there have been several class action lawsuits filed by prisoners and inmates at correctional facilities.   These cases allege that a large number of inmates were illegal searched by prison staff and correction officers. Several of these lawsuits have resulted in substantial class action settlements, including a $ 53 million settlement against Los Angeles County for illegal strip searches of thousands of women by law enforcement personnel.

Individual lawsuits seek compensatory damages for the harm suffered by the victim.  This includes both physical pain and suffering as well as mental anguish. The damages inflicted upon the victim often cause serious and permanent psychological harm.

Lawsuits hold the wrongdoers accountable for violating a person’s constitutional rights.  They also serve as a deterrence to future unlawful actions.  This helps to protect every person’s right to be free from an unlawful search and curbs systematic illegal actions of law enforcement.

Sources:

https://www.law.umich.edu/facultyhome/margoschlanger/Documents/Publications/Jail_Strip-Search_Cases.pdf

https://buckfirelaw.com/case-types/sexual-abuse/illegal-strip-search/

https://www.aclu.org/blog/criminal-law-reform/reforming-police/supreme-court-says-jails-can-strip-search-you-even-traffic

https://www.americanbar.org/groups/crsj/publications/human_rights_magazine_home/2013_vol_39/may_2013_n2_privacy/upending_human_dignity_fourth_amendment/

Buckfire & Buckfire, P.C. 2020
For more articles on the Fourth Amendment, visit the National Law Review Constitutional Law section.

“Ban the Box” Update: St. Louis Enacts Ordinance; California and Hawaii Expand Existing Laws

Under the St. Louis ban the box Ordinance (the “Ordinance”), which takes effect January 1, 2021, employers in St. Louis with 10 or more employees may not:

  1. Base a decision to hire or promote on an applicant’s criminal history, “unless the employer can demonstrate that the employment-related decision is based on all information available including the frequency, recentness and severity of the criminal history and the history is reasonably related to or bears upon the duties and responsibilities of the job position;”
  2. Inquire about a job applicant’s criminal history until after the employer has determined that the applicant is otherwise qualified for the job position, and interviewed the applicant, “except that such an inquiry may be made of all job applicants who are in the final selection pool from which the position will be filled;”
  3. Publish job advertisements, including electronically, that exclude applicants on the basis of criminal history;
  4. Include statements on job applications and other hiring forms, including electronic documents, that exclude applicants on the basis of criminal history;
  5. Inquire into, or require applicants to disclose their criminal history on initial job applications and other hiring forms, including electronic documents; and
  6. “Seek to obtain publicly available information” concerning job applicants’ criminal history.

With respect to prohibition Nos. 3 through 6, the Ordinance creates an exception where federal, state, or local law prohibits the employer from hiring an individual with a certain criminal history.

California

The California Fair Chance Act (“CFCA”) makes it an unlawful employment practice for an employer with five or more employees to include on an application for employment any question that seeks the disclosure of an applicant’s conviction history, or to inquire into or consider the conviction history of an applicant, until that applicant has received a conditional offer of employment. Additionally, the Act requires employers to: (a) make individualized assessments as to whether the conviction history has a direct adverse relationship with the specific duties of the job; and (b) provide notice under a specific procedure to employees if they intend to deny employment based on the conviction history.

Among other changes, new regulations promulgated by the California Fair Employment and Housing Council, effective October 1, 2020, expand the definition of an “applicant” to include individuals who begin work upon receiving a conditional offer of employment but before the employer has conducted or completed a criminal background check.  Ostensibly prompted by the delay some employers are encountering in obtaining relevant criminal history information due to the COVID-19 pandemic, the new rule ensures that individuals working pursuant to a conditional job offer still enjoy the protections afforded by the CFCA to “applicants.”

Also of note, the California Department of Fair Employment and Housing recently issued Frequently Asked Questions concerning the CFCA, detailing employers’ obligations under the law and providing guidance on how employers may conduct a compliant criminal background check.

Hawaii

Hawaii, which was one of the first states to create a “ban the box” law, recently added a notable amendment to the law. Effective September 15, 2020, SB 2193 prevents most private sector employers from considering felony convictions older than seven years, and misdemeanor convictions older than five years, reducing the look-back period from 10 years.

Other 2020 “Ban the Box” Developments

Maryland: As we previously reported, Maryland’s “ban the box” law, effective February 29, 2020, prohibits private employers with fifteen or more full-time employees from asking job applicants to disclose any criminal records or criminal accusations prior to the first in-person interview.

Virginia: Effective July 1, 2020, a new law that decriminalizes simple possession of marijuana also contains a “ban the box” provision prohibiting employers from requiring job applicants to disclose information concerning criminal charges, arrests, or convictions for simple possession of marijuana.

Suffolk County, New York: As we discuss here, effective August 25, 2020, Suffolk County employers with fifteen or more employees are prohibited from inquiring about a job applicant’s criminal convictions during the application process or before a first interview.

Waterloo, Iowa: Effective July 1, 2020, a new City ordinance prohibits employers with fifteen or more employees within the City of Waterloo from, among other acts, requiring applicants to disclose arrests, convictions, or pending criminal charges during the application process, including, but not limited to, any interview.  An employer, however, may “discuss” such information with an applicant if the applicant voluntarily discloses it.

*                            *                                  *

Employers covered by a “ban the box” law in one or more of the jurisdictions discussed above should review and, if necessary, update their policies and procedures, including job advertisements, applications, and other hiring (and where relevant, promotion) forms to ensure they are compliant with all applicable mandates.  Employers should also consider training personnel involved in the hiring process, particularly recruiters, human resources personnel, and those tasked with interviewing applicants and conducting criminal background checks.

©2020 Epstein Becker & Green, P.C. All rights reserved.
For more articles on labor law, visit the National Law Review Labor & Employment section.

Building Resilience for the Stressful Times Ahead

Even in perfectly normal years, the last few months seem to be abnormally stressful.  This year, the ongoing pandemic will heighten the stresses your internal clients will experience.  You can help them by communicating that everyone is feeling a bit stressed right now and sharing strategies that your clients can use to help build resilience.

How stressed are we?

Since 2007 the American Psychological Association (APA) has issued an annual report on the “state of the nation,” with a specific focus on stress.  Earlier this year the group decided to take a monthly “pulse” to understand how individuals are processing key events that have occurred.  Thus, far they have issued three separate reports.

Among the key findings are the following:

  • Most Americans are experiencing considerable stress related to the coronavirus.  They also report higher levels of general stress than in recent years.
  • On average, American parents feel higher levels of stress than adults without children.  Parental stress relates to education, basic needs, access to health care services and missing major milestones.
  • Following the May 25th death of George Floyd, more than eight in ten Americans reported that the future of the nation is a significant source of stress.  Around seven in ten Americans reported that this is the lowest point in the nation’s history that they can remember.
  • Stress levels related to the pandemic remained generally consistent throughout the spring and summer.  On a scale of one to ten, the levels of stress reported were 5.9 in April/May, 5.6 in May/June and 5.7 in July.

Among concerns lawyers express in terms of managing work, JD Supra reports 32% worry about managing the current workload during the crisis, 31% worry about a broader slowdown in overall business, and 23% worry about collaboration between and among remote employees.

Should lawyers be particularly aware of the need to manage stress?

Absolutely yes.  Research undertaken by the American Bar Association and the Hazelden Foundation in 2016 found, “[l]evels of depression, anxiety, and stress among attorneys … are significant, with 28%, 19%, and 23% experiencing mild or higher levels depression, anxiety, and stress, respectively.”  The research further noted that “61% reported concern with anxiety at some point in their career…”  Additionally, it revealed “higher levels of depression, anxiety, and stress among those screening positive for problematic alcohol use.”

For additional information, read “The Prevalence of Substance Abuse and Other Mental Health Concerns Among American Attorneys,” Journal of Addiction Medicine, February 2016.

Martin Seligman, Director of the Positive Psychology Center at the University of Pennsylvania, has postulated that American lawyers may be particularly susceptible to depression, anxiety and stress for three significant reasons:

Pessimism – According to Seligman, the “pessimist views bad events as pervasive, permanent, and uncontrollable, while the optimist sees them as local temporary and changeable.”  He further notes that “pessimists are losers on many fronts.  But there is one glaring exception:  Pessimists do better at law.”

Low Decision Latitude in High Stress Situations – Decision latitude refers to the number of choices one believes he or she has on the job. Individuals who work in fields in which high demands are placed upon them and they experience low decision latitude, i.e., there is one right and one wrong option, experience higher levels of depression and cardiovascular disease.

Win-Loss Perspective – Seligman writes, “American law has…migrated from being a practice in which good counsel about justice and fairness was the primary goal to being a big business in which billable hours, take-no-prisoners victories, and the bottom line are now the principle ends.”

For additional information, read M. Seligman, “Why Are Lawyers So Unhappy?” (2016)

What are the signs that someone is stressed?

According to the APA, the coronavirus pandemic “is an epidemiological and psychological crisis.”  Everyone needs to be aware of the signs of anxiety, depression and suicide so that we know when we’re struggling as well as when a colleague, client or family member might be at risk.

The APA cites the following:

Signs of anxiety

  • Persistent worry or feeling overwhelmed by emotions.
  • Excessive worry about a number of concerns, such as health problems or finances, and a general sense that something bad is going to happen.
  • Restlessness and irritability.
  • Difficulty concentrating, sleep problems and generally feeling on edge.

Signs of depression

  • A lack of interest and pleasure in daily activities.
  • Significant weight loss or gain.
  • Insomnia or excessive sleeping.
  • Lack of energy or an inability to concentrate.
  • Feelings of worthlessness or excessive guilt.
  • Recurrent thoughts of death or suicide.

Risk factors for suicide

  • Talking about dying or harming oneself.
  • Recent loss through death, divorce, separation, even loss of interest in friends, hobbies and activities previously enjoyed.
  • Changes in personality like sadness, withdrawal, irritability or anxiety.
  • Changes in behavior, sleep patterns and eating habits.
  • Erratic behavior, harming self or others.
  • Low self-esteem including feelings of worthlessness, guilt or self-hatred.
  • No hope for the future, believing things will never get better or nothing will change.

What can we do to combat stress?

Long-term, chronic stress can affect physical health. The American Medical Association reports that chronic stress contributes to cardiovascular disease (related to high blood pressure, truncal obesity, and high lipid levels) and diabetes (high glucose levels) and osteoporosis (bone density). It also impacts our ability to think clearly.  Throughout the pandemic, several of my clients have reported difficulty focusing on projects for extended periods of time.  They have found that the best way for them to stay productive is to break the day into 15-minute spurts of focused activity, followed by a brief diversion, and then repeat.

According to the APA, the most effective strategies for reducing stress include the following:

  • Maintaining a healthy social support network;
  • Engaging in regular physical exercise; and
  • Getting an adequate amount of sleep each night.

Senior lawyers and other managers should implement the following additional strategies:

Create structured team and individual check-ins – Senior lawyers shouldn’t make the mistake of seeing this additional management responsibility as yet one more item that keeps them from tackling client emergencies and other billable work.  The team and one-on-one conversations that senior lawyers conduct throughout the upcoming winter months may be the single most important thing that they can do to ensure junior associates develop professionally and feel connected.  Even brief check-ins will help the firm retain its best associates long after the pandemic ends.

Communicate when it’s best for others to reach you – Junior associates are desperate to communicate with partners and yearn for the serendipitous conversations that used to occur in hallways and dining rooms.  Many are also hesitant to reach out to senior lawyers, because they know most partners are extremely busy tending to client needs.  Senior lawyers should block out some portion of each workday and let juniors know that you will be available to take their calls during that time.

Offer encouragement and emotional support – Throughout the course of their careers, senior lawyers have withstood several national crises, including the Great Recession of 2008, 9/11, the bursting of the dot com bubble, etc.  When the pandemic emerged, they had the benefit of perspective, something junior lawyers don’t yet possess.  Senior lawyers can help juniors better cope by sharing what they learned from previous crises.

Many junior lawyers feel terribly isolated, expressing concerns that they are losing professional relationships daily.  Remind them to take initiative and affirmatively reach out to others…make one call a day to a peer in their practice group, a colleague in another department who is in their starting class, a law school classmate at another firm, or one of the firm’s newest associates.

If senior lawyers fail to initiate conversations, associates must be encouraged to reach out.  As I recently told one junior associate, a good rule of thumb for succeeding at life is:  if you don’t ask, you won’t get.  If you feel the need for a mental health day, you need to ask for it; if you want to work on a specific client project, be prepared to ask to join the team; and if you need 10 minutes of a partner’s time to better understand the parameters of an assignment, send a meeting request immediately.  Juniors should be reminded that they won’t always “get” everything that they request, but they will increase the sense that they’ve taken control of their careers by asking.

© 2020 Mary Crane & Associates, LLC
For more articles on the workplace, visit the National Law Review Labor & Employment section.

Who is considered “disadvantaged” for purpose of a Disadvantaged Business Enterprise (DBE) and Minority Business Enterprise (MBE) Certification? The answer may surprise you.

For purposes of Disadvantaged Business Enterprise (otherwise known as “DBE”) Certification, the Code of Federal Regulations, 49 C.F.R. §§ 26.5 and 26.67(a)(1) provide that there is a rebuttable presumption of disadvantage for United States citizens (or lawful admitted permanent residents) who are:

  • Women;
  • Black Americans;
  • Hispanic Americans (persons of Mexican, Puerto Rican, Cuban, Dominican, Central or South American, or other Spanish or Portuguese culture or origin);
  • Native Americans (persons who are enrolled members of a federally or state recognized Indian tribe, Alaska Natives or Native Hawaiians);
  • Asian-Pacific Americans (persons whose origins are from Japan, China, Taiwan, Korea, Burma (Myanmar), Vietnam, Laos, Cambodia (Kampuchea), Thailand, Malaysia, Indonesia, the Philippines, Brunei, Samoa, Guan, the U.S. Trust Territories of the Pacific Islands, Samoa, Macao, Fiji, Tonga, Kirbati, Tuvalu, Nauru, Federated States of Micronesia or Hong Kong);
  • Subcontinent Asian Americans (persons whose origins are from India, Pakistan, Bangladesh, Bhutan, the Maldives Islands, Nepal or Sri Lanka); or
  • Other minorities found to be disadvantaged by the SBA.

It may be a surprise to some that persons of Middle Eastern and North African origin are not considered disadvantaged by the DBE program.  In fact, the U.S. Department of Transportation has found that “[p]ersons of Lebanese and other Middle Eastern origins are not presumed disadvantaged under the regulations.”    In re SanUVAire, LLC, No. 20-0029, March 30, 2020.

Persons of Middle Eastern origins may also not be eligible for certain Minority Business Enterprise certifications, though it can be inconsistent from group to group.  While the Southern Region Minority Supplier Development Council allows certification of persons of Middle Eastern origin, the Eastern Minority Supplier Development Council does not, even though both are affiliated with the National Minority Supplier Diversity Council.

©2020 Strassburger McKenna Gutnick & Gefsky
For more articles on disadvantaged business enterprises, visit the National Law Review Labor & Employment section.

COVID-19 Telecommuting Tax and Leave Issues for Employers

Months into the COVID-19 pandemic, many employer telecommuting arrangements remain in place, with several large corporations opting to extend these arrangements well into 2021.  The benefits of such arrangements have been clear for many employers during the pandemic, including that they permit continued productivity while keeping employees safe.  However, the longer that employees remain out of the office, the more telecommuting-related issues arise, including with respect to taxation of employee income and leave requirements, which we discuss below.

Tax Implications of an Employee Working Remotely Due to the COVID-19 Pandemic

As a general rule, employees pay income tax in the state in which they perform services for an employer.  For example, if a teleworking employee lives and works entirely in New Jersey despite the fact that her employer is located in Florida, the worker’s income tax would be withheld according to New Jersey law and paid to the State of New Jersey.  Many states have reciprocal agreements with one another on the treatment of taxes when an employee works in one state and lives in another.  Two neighboring states will agree that an employee who works in State A can pay income tax in their home State B, allowing the employee to file one tax return each year.  In the absence of tax reciprocity agreements between neighboring states, employees may be subject to income taxes in two states (for example, New York and New Jersey).  With masses of employees teleworking in a different state from their typical work arrangement, where the employee should pay income taxes becomes increasingly complicated.

Some states have addressed this issue and other business-related tax implications caused by COVID-19.  For example, the Massachusetts Department of Revenue issued emergency regulations concerning telecommuting employees, outlined in a Technical Information Release (“TIR”).  The TIR became effective on March 10, 2020 and remains in effect until Governor Baker gives notice that the state of emergency is over.  The TIR clarifies (1) the treatment of personal income taxes for employees currently working outside the state (i.e., telecommuting) due to COVID-19; (2) sales and use tax nexus for vendors with a “physical presence” in Massachusetts solely due to COVID-19; (3) whether a business is subject to a corporate excise tax with employees currently “conducting business” on its behalf in Massachusetts; and (4) whether to tax employees currently working inside or outside Massachusetts for Paid Family and Medical Leave purposes (more on this piece below).

New Jersey similarly issued FAQ’s addressing telecommuting tax implications.  The state’s Division of Taxation waived the “nexus-creating” impact on out-of-state businesses with employees currently working in New Jersey as a result of COVID-19.  The Washington D.C. Office of Tax and Revenue published similar information stating that it will not impose a corporate franchise tax nexus on employers because employees are telecommuting during the public emergency caused by COVID-19.

In the absence of guidance from each state on remote work tax implications, employers are encouraged to consult legal counsel or their accountants on how out-of-state remote workers impact company tax obligations.

Leave Law Implications of Employee Remote Working

It was hard enough before the pandemic started to untangle the complex web of leave entitlements that may apply to an employer’s workforce in different states.  This web of leave laws becomes even more complicated however, when employees telecommuting in a different state from which they typically work begin to impact the employee’s eligibility for local leave.

For example, how does an employee who regularly works in New York City but is now working remotely from New Jersey accrue sick leave?  Is the employee entitled to New York City Sick and Safe Time and/or New Jersey Sick Leave?  Ultimately (and absent additional guidance) the answer will depend on the eligibility requirements of the leave, and the specifics of the employee’s work history.

In this scenario, New Jersey’s FAQs on sick time provides that “a telecommuter who routinely performs some work in New Jersey is entitled to full earned sick leave covered under [New Jersey’s] Earned Sick Leave Law so long as the employee’s base of operations or the place from which such work is directed and controlled is in New Jersey.”  Based on this guidance, would an employee who typically works in New York City, but who is currently telecommuting in New Jersey as a result of the pandemic be entitled to sick leave under New Jersey law?  As the pandemic, and in turn this telecommuting arrangement, continues, at what point does the employee’s base of operations shift to New Jersey requiring the employer to provide sick leave?

At the same time, would this employee still be entitled to accrue sick leave under New York City’s law (and New York State’s new law, discussed in our previous post)?  New York City’s law, which was recently amended, has interpretive guidance (applicable under the old law) stating that an employee only accrues sick leave under the New York City law when they perform services in New York City.  If they are subject to a temporary telecommuting arrangement, do they lose eligibility to accrue New York City sick leave?  Will New York City update its guidance to address this issue?  Will New York State issue guidance under its new law to address this issue as well? Employers should also be mindful that employees may be able to maintain multiple accruals depending on where they perform services.

In Massachusetts, the state has thankfully clarified how to treat employee eligibility for the Massachusetts Paid Family and Medical Leave Act.  Employers and employees began contributing to the Commonwealth’s trust for paid family and medical leave benefits back in 2019, and most leave entitlements will become available in a few short months on January 1, 2021 (see our blog posts on preparing for Massachusetts Paid Family and Medical Leave here and here).  However, many employees regularly working in Massachusetts commute in from neighboring states including Rhode Island and New Hampshire.  With such employees now living and teleworking outside of Massachusetts, should employers still deduct contributions from employee paychecks?  Fortunately, the Massachusetts DOR addressed this issue in its Technical Information Release described above:  An employee who previously performed services outside of Massachusetts and was not subject to PFML will not become subject to PFML solely because the employee is temporarily working from home in Massachusetts.  Likewise, an employee who previously performed services in Massachusetts but is temporarily working from home outside of Massachusetts solely due to COVID-19 continues to be subject to the PFML rules.  However, if employers decide to extend teleworking arrangements beyond the pandemic, this guidance will no longer apply.  Employers will need to determine if and when an employee becomes subject to (or is no longer subject to) Massachusetts Paid Family and Medical Leave.

Employers may be able to conduct a quick analysis to determine whether an employee is or is not entitled to a certain leave benefit while COVID-19 state of emergencies remain in place in many states.  However, if long-term telecommuting arrangements become the norm after the pandemic ends, employers must reevaluate applicable leave policies to ensure they align with their new remote workforce.

Parting Shot

As the last several months of telecommuting has taught us, working from home can have both benefits and drawbacks.  Employers are encouraged to consult with counsel before making tax and leave-related decisions that impact employees, as they relate to remote working during the COVID-19 pandemic.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.
For more articles on tax and labor topics, visit the National Law Review Labor & Employment section. 

Inclusivity and High Performance Begins with Psychological Safety

A workplace where employees believe they can speak up candidly with ideas, questions, and concerns, and even make mistakes without fear of reprisal or adverse repercussions, contributes to inclusivity and can improve performance. In such a work environment, employees feel comfortable asking questions, admitting what they do not know, or expressing their work-relevant thoughts and feelings. This construct is called psychological safety.

According to Lisa H. Nishii, Ph.D., Associate Professor of Human Resource Studies and Director, International Programs, in the School of Industrial Labor Relations of Cornell University, with regard to psychological safety:

The issue to think about here is if team members can’t bring themselves to speak what’s on their mind — that is they censor themselves, then they won’t experience inclusion, nor will the group benefit from their perspectives. If team members don’t trust each other, then they’re going to waste time and energy thinking about what they should say, and what they shouldn’t say, and wonder about the true intentions of their peers when they’re interacting with them.

In comparison, when employees feel free from worrying about repercussions, how they will be perceived, or what people will think of them, they are able to be more engaged and connected in the workplace. They spend less time and energy being stressed or anxious, can create more mental space to think creatively, share their unique perspectives, and are more actively engaged in problem solving.

Psychological safety is important for all employees to feel included and is particularly important for employees who have been historically underrepresented in a particular field or workplace. I recall an early experience as an African American attorney working in a predominantly white law firm. On the first day, I filled out paperwork in a large conference room decorated with portraits of the founders of the firm — all white men. I was introduced to the office manager and head of the class action practice group — all white. I was then provided a firm manual on trends in class action litigation including photos of the authors — all white. One of the initial messages conveyed to me from seeing these images was that I did not belong. These initial messages, compounded with seeing few African Americans at the firm and even fewer in leadership positions, created an environment where I did not feel safe to ask questions, fully engage, or share my viewpoint or perspective — not because of a lack of skill or talent, but because my environment did not feel safe to authentically show up in.

Psychological safety assists in creating an inclusive environment. Inclusion enhances performance and retention, which furthers a company’s ability to meet its goals and financial targets. However, in order for organizations to get the benefits of inclusion, employees from underrepresented groups need to feel comfortable presenting their authentic selves. If an employee does not feel welcome or included, the employee will engage, if at all, out of obligation and not with the uninhibited feeling of being a part of a psychologically safe organization.

Here are six tips to create psychological safety for employees in the workplace, particularly for employees who have been historically underrepresented:

1. Understand Stereotypes and Preconceptions, and Conduct a Diversity and Inclusion Assessment

We all have conscious and unconscious biases. Unconscious biases are more concerning because, by definition, we are not fully aware of them. Unconscious biases are beliefs about certain groups of people that individuals form outside their own conscious awareness. A critical step in creating psychological safety is to understand one’s personal biases, along with those of the organization.

Therefore, an initial step in creating psychological safety is discussing bias, as well as conducting anti-bias training. Additionally, conducting a diversity and inclusion assessment can provide your organization a data-driven understanding of the current workplace demographics and culture around diversity and inclusion. Weldon Latham, founder of the unique Jackson Lewis Corporate Diversity Counseling Group, has been representing Fortune 200 companies and conducting diversity and inclusion assessments for over 20 years. He advises:

Implementing diversity initiatives in a vacuum can actually be harmful to an organization. A better approach is to conduct a diversity, equity, and inclusion (“DEI”) assessment of key metrics and cultural indicators, and prepare a DEI Strategic Plan that will inform the development of effective initiatives.

2. Empathize and Be Curious

Put yourself in the shoes of a new employee and try imagining what they are going through. This is even more important when the incoming employee is of a different race, age, gender identity, sexual orientation, ability, or status different from the majority of employees in the same or similar role. Organizations might be tempted to apply a one-size-fits-all approach to creating teams or assigning supervisors without understanding the potential for individuals who are underrepresented to feel excluded. You may need to empathize with the experience of an employee who finds themselves doubted or judged because of personal characteristics. This might alter how you create teams or assign supervisors.

As a result, curiosity becomes important. According to dictionary.com, curiosity is a “a strong desire to know or learn something.” As it relates to diversity, curiosity is having a strong desire to learn about the experiences of others to create an environment where employees feel seen and heard, and uninhibited to share their perspectives.

Empathy and curiosity in the workplace include taking the time to ask employees about their ideal supervision: the style of communication (email or call), type of feedback (direct or example), and frequency of checking in (daily or weekly). It does not mean accommodating all of these requests, but listening and trying. This not only builds trust but encourages employees to “buy in” or feel engaged if they feel they have had some say-so in their work experience.

3. Onboard with Intentionality

An important step in mitigating cultural barriers occurs at the start of employment. Michael D. Watkins stated in his Harvard Business Review article, “7 Ways to Set Up a New Hire for Success,” effective onboarding “brings new employees up to speed 50% faster, which means they’re more quickly and efficiently able to contribute to achieving desired goals. Effective onboarding also dramatically reduces failure rates and increases employee engagement and retention.”

Often employers believe in hiring talent and providing training over time. But making efforts to help employees feel welcome and valued upfront will build confidence and belief that they belong. It will also reduce stress and anxiety and create an initial feeling that it is safe to engage or add value. Moreover, if an organization lacks diversity, careless onboarding can heighten feelings among underrepresented employees of not belonging.

4. Be Consistent

Litigation often results when communication and behavior are not aligned. Make sure your actions in the workplace match your messaging. Over the past several months, employers have released statements about racism and made various commitments to diversity and inclusion. Similarly, more employers are requiring implicit bias training. Public statements and training, however, must result in changes in workplace behavior, otherwise you lose credibility with employees.

Similarly, some workplaces have “unwritten rules” on achieving success. This runs counter to an inclusive environment because there is inconsistency between written metrics for performance and promotion and the realities of the workplace. If an inclusive environment was in place and functioning, there would be no need for “unwritten rules.” Until that is the case, knowing the “unwritten rules” or what you are “up against” at a minimum empowers an individual to make more informed decisions about navigating their way in the workplace.

Psychological safety ultimately involves trust, which takes time to build and work to keep. If an employer’s actions around diversity and inclusion are inconsistent with its messaging to employees or to the public, the employer will lose credibility. Employees, particularly those who are underrepresented or who have been marginalized, will feel less safe in the workplace because of these inconsistencies.

5. Develop Opportunities for More Interpersonal Interactions

Employees need to have more opportunities to interact organically to form social bonds and trust over time. I can recall as a junior attorney speaking with a white senior attorney whom I was starting to work with more. She asked about my weekend. I responded that I went to a concert. She asked, who did I see? I felt uncomfortable saying “Public Enemy” because I felt she might not know them or might judge me in a way that would negatively impact our working relationship. Instead, I answered “a band I used to listen to in college.” As we worked together, we were able to get to know one another more and I was able to share more about myself. Through this rapport, we both realized we had more in common than we may have initially perceived. As I built social ties, it was easier to ask for help, acknowledge when I did not know something, or challenge a strategic decision.

When management takes the time to build an understanding of other people, it becomes more comfortable to speak up. It is helpful for workplaces to think of ways to foster and support positive, healthy interactions among employees. This may include collaborations across teams, informal discussion at periodic team meetings, or setting boundaries and expectations for employee interpersonal engagements that are informed by inclusion.

Moreover, if employees feel more comfortable in the workplace, they are likely to discuss any disputes internally and seek to resolve them cooperatively.

6. The Value of a Diverse Pool of Employees

When you create a work environment where employees see a representation of themselves in varying positions within the workplace, they are more likely to feel comfortable being themselves. One way to help achieve this is to increase the diversity of the pool of candidates considered for positions. The Rooney Rule in the National Football League and the Mansfield Rule adopted by numerous law firms are two examples of ways to increase diversity within all levels of an organization.

Diversity and inclusion is a journey. Like most journeys, a well-crafted vision is key to its success, but be wary of legal traps. Failing to think strategically about diversity can result in employees feeling unsafe in the workplace. A well-crafted diversity and inclusion strategy fueled by data from a diversity assessment creates more employee engagement, less employee turnover, and, importantly, helps reduce stress, anxiety, and fear that may result in litigation.

Jackson Lewis P.C. © 2020
For more articles on the legal industry, visit the National Law Review Law Office Management section.

Four Tips to Retaining & Sustaining Your Team’s Motivation During COVID-19

It’s no surprise the novel COVID-19 pandemic is upending the lives of employees who are struggling to focus and stay engaged at work as fears of becoming unemployed or ill loom. As partners grapple with staff changes, juggling client and colleagues’ expectations and adjusting to a new work environment, now more than ever, they’ll need to step in and navigate the new reality of the workplace during this global crisis in order to maintain their employees’ morale. Here are a few ways to keep your team motivated and engaged during these unprecedented times:

  1. Celebrate the big and small wins: No small effort goes unnoticed. Try celebrating small wins, such as a successful call with a potential client, a project being finalized ahead of schedule, or brainstorming a creative idea that piques the client’s interest. Notify other team members as well so everyone can share in the celebration. The big wins almost always receive recognition but getting into the habit of showing appreciation for the small victories will keep staff optimistic and productive.
  2. Proactively assist with other projects: Being buried in projects makes employees feel overwhelmed, stressed and anxious. If you notice an assignment is taking them longer than usual, offer to support certain elements of the project or provide suggestions on how to streamline the process. Another helpful solution is extending deadlines and pulling in other team members that can contribute in a meaningful way. This not only fosters a sense of collaboration, but it creates a healthy manager-employee relationship that survives trying times.
  3. Conduct regular check-ins: With the simple touch of a button, you can connect with people in an instant via FaceTime, Zoom, or Skype. By scheduling and consistently checking-in with your colleagues every week, you allow them the opportunity to voice their concerns and strategize next steps without back and forth emails and text. It also allocates time for human interactions and closeness to help diminish feelings of isolation and loneliness.
  4. Laughter is the best medicine: Who says work must be boring? If you see an article that relates to your industry and it has an interesting or humorous angle, share it. Laughter is the best medicine in hard times and can serve as a stress reliever. Every time you come across something positive, routinely send it around as a “thought you might like this!” to solicit a laugh or two.

Every day presents new opportunities and new challenges. While there’s no clear answer as to when things will return to normal, here’s one thing employers should never forget: a community-driven experience always enables individuals to go the extra mile.

© 2020 Berbay Marketing & Public Relations
For more articles on the legal industry, visit the National Law Review Law Office Management section.

Toward a More Expansive View of Mentoring

Mentoring has increasingly been recognized as a critical ingredient of success in many endeavors in individuals’ lives. In many instances, however, mentoring tends to be depicted as a relationship where a senior leader takes a junior professional under their wing and imparts the “formula” for success. Thus, mentoring programs often focus on pairing each junior employee with one senior person who is designated as their mentor.

Our firm’s mentor surveys and interviews indicate that while such pairings can lead to desired outcomes, investing in building and maintaining a more expansive view of mentoring is likely to be even more effective. Cultivating a shared understanding that each individual can be an effective mentor in their area(s) of comparative strength encourages long-term mentoring relationships that emerge and evolve organically, and enables an organization to make the most of its mentoring resources.

While there is widespread consensus that mentoring is critical to the long-term success of an organization, defining mentoring is more challenging than it seems at first glance. When asked, each of our firm’s leaders defined it slightly differently, as a “process,” “form of leadership,” “opportunity,” “mindset,” “set of actions,” or “ability,” among other things. Realizing all of these responses are valid, we find it helpful to focus not on what mentoring is but rather on the behaviors that are involved in effective mentoring. We organized our approach by segmenting mentoring into four distinct elements—feedback, opportunity creation, connections and counsel, and role modeling. We discuss each of these in turn, including specific recommendations for both mentors and mentees from our mentor surveys and interviews.

Feedback

Mentors play a critical role in recognizing positive contributions, offering specific coaching on work-product or delivery, and providing direct, clear, and actionable feedback to mentees. Assigned evaluator roles for performance review purposes can be the basis for mentoring relationships to take hold. However, our data indicate that the most effective mentor relationships are not based on an assigned evaluator role. Many of our survey participants indicated that working together on projects provided the best opportunity for feedback. To take advantage of that opportunity, a mentor should “give real-time feedback, discussing what is the best way to handle a given situation and why.”

Opportunity Creation

In developing future leaders, it becomes increasingly important for mentors to proactively identify opportunities that not only enable the firm to serve its clients or customers in the best possible way but also align with mentees’ career plans and create “stretch roles” to accelerate their career development. It is valuable to “be explicit when you are providing an opportunity to an individual. For example, when you would like to staff an individual on a project that will help them develop expertise in given area, don’t just ask them to work on the project—explain why this is an opportunity.” Mentees benefit greatly from a targeted approach to opportunity creation: “Think of providing specific opportunities to specific people … for example, staff individuals on repeat projects with the same clients so that they can develop client relationships.”

Mentors should not see their role as limited to personally offering opportunities to mentees but rather take a broader perspective. For example, they should “watch out for opportunities for their mentees, inform them of opportunities they may not be aware of (because mentors have a more firm-wide view than mentees), and make the connections they may need to take advantage of such opportunities.”

Mentees have to share this responsibility, in part by being specific about what opportunities they are interested in, such as opportunities involving a particular topic, a stretch role, or a particular client. This allows the request to have “the benefit of triggering a memory when an opportunity arises, rather than leaving it to chance for a mentor to make the connection.”

Effective opportunity creation can also take the form of the mentor sharing their network with the mentee, making introductions, and/or creating visibility for others who do not have exposure to the mentee. Mentors should “help others around the organization get to know their mentees, their strengths and their contributions.”

Mentees should “ask their mentors for ideas and help in creating connections to other potential mentors.” In this context, the emphasis on the importance of female-to-female mentoring represented the only discernable distinction in comments we received from female and male participants in our mentor surveys and interviews. As one female survey participant commented: “I need female mentors to ask about things such as how to assert myself while being genuine.”

Connections and Counsel

Mentees often seek information about how to navigate the organization and career development in general, or a complicated situation in particular. Acting as a thought partner in providing career counsel that is both specific to the individual and actionable is critical to the development of future leaders: “Rooting for an individual and helping them with specific problems is great, but not sufficient. Your mentees also need partnering to help them think through their career goals and how to achieve those goals.”

In addition, mentors should “remember that just telling mentees the variety of things they can do to advance in their careers is not sufficient. Mentees need help figuring out how to prioritize the various things they can do. Mentors should ask questions that identify areas where their mentees ‘don’t know what they don’t know.’ They should share what they can to demystify how things work, with a client or expert, within the firm, or within our industry.”

This involves “recognizing and sharing patterns mentees may not see. One of the benefits of experience is pattern recognition. Often, the things mentors take for granted due to experience are very illuminating when shared with mentees who have less experience.” As a corollary, mentees “should be specific in asking questions that mentors can react to, as opposed to broad questions like ‘what should I do with my career?’, which is hard to respond to in a meaningful way.”

Role Modeling

Role modeling as a mentor is most effective when it goes beyond leading by example. In its most complete form, role modeling includes actively mentoring future mentors, rather than assuming that mentees will naturally invest time in mentoring others. Senior leaders can explicitly ask those in managerial roles to “talk to their team members who have management responsibilities about expectations and strategies for mentoring on teams.” Leaders can “create a culture of accountability for mentoring on teams by regularly asking about how team members are doing and how the team can be effective together in developing each other.”

In addition, one of the most powerful levers for effective mentoring—and one that can be used without much incremental investment of time—is providing opportunities for mentees to learn through observation or osmosis. A quick follow-through that makes the observation explicit is all that is required. For example, “after a client call or meeting, take a few minutes to explain why you handled things as you did to enable your mentees to learn how to serve the client in the best way possible so that they can benefit from the wisdom you have developed through experience.”

In parallel, mentees should “identify the opportunities to learn through osmosis and recognize that as an opening. When you observe something you want to emulate, ask the mentor how they thought about it, prepared, and learned how to become skilled at the behavior you observed. When you have gained insight from observing a behavior, acknowledge the value and describe why it was helpful. This will encourage mentors to be more explicit in the future.”

It is rare for any one mentor to be equally adept across the four elements discussed above. As one survey participant suggested, “The bottom line is that mentoring is not a one size fits all. We should all ‘mentor’ in a way that is natural and comfortable—and perhaps stretch a little beyond that.” This suggests that a single mentor will rarely be able to fulfill a mentee’s needs across all four elements. The experience of another survey participant highlights the importance of cultivating a network of mentors with different experiences and styles who each excel at different elements of mentoring:

I’ve had multiple excellent mentors. For example, I learned a lot about the nature of our work from Alice. Being in the room and watching her interact with clients has been extremely helpful. Also, she thinks aloud and it was very helpful to learn how she thinks. But Alice is not a good business development mentor. She says “just go have lunches.” She’s not helpful to me about how to navigate the firm, who I should be connected to, and how to most effectively connect with them. Bob is great at that. He tells me the specific things I can do. He thinks a lot in advance, then provides clear direction and targeted advice about next steps.

The recognition that different people excel at different elements of mentoring prevents viewing individuals as either categorically strong or categorically weak mentors. Instead, it allows an organization to make the most of the comparative strengths of each individual, expanding overall mentoring capacity and the pool of potential mentor relationships.

Segmenting mentoring elements into four discrete areas is not the only way to broaden the available set of connections. Our mentor surveys and interviews also highlight the importance of peer and “reverse” mentoring relationships. Connections among peers are critical to integrating new staff and creating a sense of shared affiliation with the firm, which supports retention. We see enormous value accruing to those who “initiate and maintain peer mentoring relationships; building trust-based relationships with colleagues who have similar experiences benefits their careers in the short and long term.”

“Reverse” mentoring refers to instances where someone more senior identifies a mentor who is less senior to them. Senior leaders of our firm often identify reverse mentors as part of their mentor network and suggest that input from junior colleagues enables them to become better leaders.

Cultivating a well-established mentor-mentee relationship requires mutual awareness of the connection as a precursor to commitment by both parties. While our surveys show extensive mentor relationships identified by both mentors and mentees, the connections are not consistently named as such by both parties. We refer to instances where an individual identifies someone as a mentee and the mentee identifies the individual as a mentor as a “matched pair.”  However, we also find a substantial incidence of “unmatched pairs,” suggesting that all too often, the connection between a mentor and mentee is left unstated. This may be in part because not every individual views mentoring in the broad terms described above. Especially in those situations, both mentor and mentee would benefit greatly from a shared understanding of available mentoring opportunities.

The solution is simple, but often will not happen without being prompted. Mentors should tell mentees that they see them as a mentee, explain why, and share how they can act as a mentor, which may include things the mentor has already been doing on the mentee’s behalf, but did not naturally think to share. Similarly, mentees should explicitly tell mentors that they see them as a mentor, explain why, and indicate which specific elements of mentoring they would appreciate mentoring from them.

In sum, focusing on cultivating a network of mentors who play different roles based on natural strengths and expanding our view of who can be a mentor is likely to be much more effective in realizing our highest potential, for both developing people and building firms with strong mentoring cultures.

Note: The quotes used in this article have been redacted to preserve anonymity and edited for clarity. The views expressed in this article are solely those of the authors, who are responsible for the content, and do not necessarily represent the views of Cornerstone Research.

Copyright ©2020 Cornerstone Research
For more articles on the legal industry, visit the National Law Review Law Office Management section.

Hawaii Tightens Ban-the-Box Law, Further Limiting Use of Past Criminal History in Work Decisions

Hawaii has narrowed the scope of what employers can consider regarding an individual’s conviction history when making employment decisions.

Hawaii employers have long been required to limit their consideration of felony and misdemeanor convictions to a 10-year lookback period, unless they fell within one of the statutory exemptions as part of its longstanding “ban the box” legislation. State law has further required employers to apply a “rational relationship” test before denying a prospective or current employee a position following a background check, which means an employer may only consider those convictions occurring in the permissible time period if there is a “rational relationship” between the convicted crime and the prospective job.

The Hawaii legislature has taken further steps to narrow the scope of what employers can consider regarding an individual’s conviction history. The concern was that, without further change, the “rational relationship” test would still be ripe for subjectivity, creating a potential for inconsistent application due to express or unconscious bias, which can result in discrimination against a person who has long since paid their debt to society and who poses little to no risk to the employer or to the public. Consequently, on September 15, 2020, the Governor of Hawaii signed into law Act 051 (20), amending Hawaii Revised Statutes Section 378-2.5 by reducing the “lookback” period and differentiating between felonies and misdemeanors. The intent was to minimize any possible conscious or unconscious bias that arises when an employer views an “old” crime when making employment decisions.

Felonies older than seven years and misdemeanors older than five years are no longer relevant toward job suitability determinations, unless they fall within one of the existing 18 statutory exemptions, e.g., Department of Education employees. Even with these distinctions and limited “lookbacks,” employers must still apply the “rational relationship” test when making employment decisions.

Additionally, the suitability determination with respect to relevant criminal history may only occur after the applicant has received a conditional job offer.

If an employer has extended a conditional job offer to an applicant or offered a current employee a promotion and the person’s background check reveals a criminal history for a Hawaii-based position, seek legal counsel to review any potential exposure, if applicable, arising out of the reduced “lookback” period and application of the “rational relationship” test before denying employment.

Jackson Lewis P.C. © 2020
For more articles on employment law, visit the National Law Review Labor & Employment section