Category: Labor & Employment

Recognizing Juneteenth and Strengthening Company Culture: Tips for Employers

Several prominent companies across the nation recently announced that they would observe Juneteenth as a holiday. This new trend of observing Juneteenth comes in the wake of several weeks of protests across the world advocating for an end to racial injustice and police brutality. These protests have generated discourse across the country, including in workplaces, about systemic racism and what actions we all can take to address the issues. Although Juneteenth is not a new holiday, recognizing and observing the holiday is one of many proactive measures that employers can take to demonstrate their commitment to fostering diverse and inclusive workplaces and to promoting racial justice.

What Is Juneteenth?

Juneteenth is the oldest nationally celebrated commemoration of the end of legal slavery in the United States. Although the Emancipation Proclamation was issued on January 1, 1863, the news did not reach enslaved Black people in Galveston, Texas, until June 19, 1865, where it was met with shock and jubilation.

The newly-freed people in Galveston celebrated after the announcement, and the following year, freedmen and freedwomen organized the first of what became the annual celebration of “Jubilee Day” on June 19 in Texas. Over time, the annual celebration spread from the Black community in Texas to the rest of the United States. Juneteenth celebrations focus on education, history, self-improvement, culture, and pride.

Who Is Observing Juneteenth?

Many companies have announced they will make Juneteenth an annual corporate holiday. The decision to observe Juneteenth in the workplace comes as more employers voice their support for racial justice. Other companies have also announced donations to organizations promoting racial justice.

How Can Employers Observe the Holiday?

Give employees a paid day off.

Consider observing Juneteenth as a company holiday and giving employees a paid day off as the company would for other observed holidays. This can help remind employees that the employer believes that the history of all its employees matters and that it is taking an active stand to promote racial justice.

If closing to observe Juneteenth is not a viable option for a company, they may want to consider alternatives. For example, some companies plan to remain open and give full-time non-exempt workers the option of taking the day off with full pay or working the day with time-and-one-half pay.

Honor Juneteenth in the workplace.

Recognizing Juneteenth in the workplace can strengthen a company’s commitments to its mission, vision, and values to promote a diverse and inclusive workplace and to foster social and racial justice.

There are many ways that employers can commemorate Juneteeth in the workplace:

  • Invite guest speakers to the workplace to speak on current issues;
  • Sponsor relevant workplace activities (on-duty and off-duty); or
  • Engage in the same kinds of activities that the company engages in for other commemorations for people of color.

Participate in local Juneteenth events.

Many communities across the country host Juneteenth celebrations. These events include parades, rodeos, cookouts, live concerts, and community outdoor activities. Consider hosting a company-sponsored booth or contest in these community events.

Is Juneteenth an Observed Holiday?

Juneteenth is an observed holiday in 47 states and the District of Columbia, but it is not a mandated federal holiday. Texas was the first state to recognize Juneteenth as a state holiday in 1980. A more comprehensive history of Juneteenth can be found here.

© 2020, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.

Supreme Court Rules Title VII Bars Discrimination on the Basis of Sexual Orientation and Gender Identity

Today, June 15, 2020, the Supreme Court of the United States issued a landmark decision in Bostock v. Clayton County, Georgia, holding that Title VII of the Civil Rights Act of 1964 (“Title VII”) protects lesbian, gay, bisexual, and transgender workers.  The Court held that employers who discriminate against employees based on sexual orientation or gender identity unlawfully intend to rely on sex in their decision-making. Justice Gorsuch, along with Chief Justice Roberts and the four liberal justices of the Court, wrote, in deciding the question of whether an employer can fire an individual for being homosexual or transgender: “the answer is clear.”  Specifically, “an employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex.  Sex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids.”  Ultimately, “an employer who fires an individual merely for being gay or transgender defies the law.”

Bostock v. Clayton County, Georgia consisted of three individual employment cases, all of which involved an employer terminating the employment of a long-time employee shortly after the employee revealed the he or she was homosexual or transgender.  Gerald Bostock worked as a child welfare advocate for Clayton County, Georgia for over ten years and was fired shortly after participating in a gay recreational softball league.  The reason given for his termination was an allegation of misspent funds and “conduct unbecoming of a county employee;” however, Bostock argued that was pretense and the real motivation for his termination was his sexual orientation.  Both the District Court and the Eleventh Circuit held that Title VII did not include protection against discrimination towards sexual orientation.

In Altitude Express Inc. v. Zarda, Donald Zara worked as a skydiving instructor for Altitude Express in New York.  Zarda worked for the company for several years and his employment was terminated shortly after mentioning to his employer that he was gay.  While the District Court ruled in favor of the employer, the Second Circuit ruled that Title VII protects employees from discrimination based on sexual orientation.

Lastly, in R.G. & G.R. Harris Funeral Homes Inc. v. Equal Employment Opportunity Commission, Aimee Stephens, a funeral home employee in Garden City, Michigan, who originally presented herself as a male upon hiring, revealed to her employer during her sixth year of employment that she would be transitioning and working and living full-time as a woman.  Shortly thereafter, she was dismissed from her job due to her transition.  Initially, the District Court found for the funeral home on two bases: (1) Title VII did not protect transgender persons nor gender identity, and (2) the Religious Freedom Restoration Act permitted the funeral home to make employment decisions based on faith.  The Sixth Circuit reversed this decision, ruling that Title VII’s “discrimination by sex” does include transgender persons and also that the funeral home had failed to show how Title VII interfered with its owner’s religious expression.

Given the split among the circuit courts, the Supreme Court took up this trio of cases to render a clear determination as to whether sexual orientation and gender identity are protected categories under Title VII.  This case of first impression signifies a key development in the interpretation and meaning of discrimination on the basis of “sex” under Title VII.  The opinion resolved the issue of whether those who drafted Title VII could have intended protection of these classes, with Justice Gorsuch explaining: “Those who adopted the Civil Rights Act might not have anticipated their work would lead to this particular result. Likely, they weren’t thinking about many of the Act’s con­sequences that have become apparent over the years, in­cluding its prohibition against discrimination on the basis of motherhood or its ban on the sexual harassment of male employees. But the limits of the drafters’ imagination sup­ply no reason to ignore the law’s demands. When the ex­press terms of a statute give us one answer and extratextual considerations suggest another, it’s no contest. Only the written word is the law, and all persons are entitled to its benefit.”

Employers must ensure that their policies, including their equal employment opportunity, harassment, and discrimination policies, reflect this opinion and prohibit discrimination on the basis of sexual orientation and gender identity.  In addition to these policy matters, employers should take actions to prevent discrimination on the basis of sexual orientation or gender identity and communicate the development in the law to employees and key decision makers in the company.

The full opinion can be found here.

© 2020 Bracewell LLP

For more on the SCOTUS Title VII decision, see the National Law Review Civil Rights law section.

BREAKING: US Supreme Court Rules Title VII Protects LGBTQ Employees

In a highly anticipated decision, the U.S. Supreme Court held Title VII of the federal Civil Rights Act protects LGBTQ employees from being fired because of their sexual orientation or gender identity.

The opinion, released on June 15, 2020, was a consolidation of three federal appellate court decisions—Bostock v. Clayton County; Altitude Express v. Zarda; and R.G. & G.R. Harris Funeral Homes v. Equal Employment Opportunity Commission. In each case, the employer terminated the plaintiff after learning that he or she was gay or transgender.

In Bostock, the 11th Circuit Court of Appeals held Title VII did not protect an employee against discrimination because of his or her sexual orientation, relying on circuit precedent. The 2nd Circuit came to the opposite conclusion in Zarda, concluding an employer discriminated on the basis of sex (including gender stereotypes) when it terminated a long-time employee. In R.G. & G.R., the 6th Circuit held Title VII protected against discrimination based on an employee’s transgender or transitioning status because such discrimination is grounded in an employee’s failure to conform to gender stereotypes.

Justice Neil Gorsuch, writing for the majority, analyzed whether discrimination because of sexual orientation or transgender status is fundamentally sex discrimination for failing to conform to gender stereotypes—an issue already determined to fall within Title VII’s scope.

In its analysis, the majority used the example of an employer who has a policy of firing any employee who is known to be gay. According to the Court, if a model employee brings a female spouse to an office holiday party and the employee is then fired due to also being female rather than male, the employer discriminated on the basis of sex, even if the intent was to discriminate on the basis of sexual orientation.

Similarly, the Court reasoned that an employer cannot discriminate against one of two otherwise identical female employees because she was identified as a male at birth. In doing so “the employer intentionally penalizes a person identified as male at birth for traits or actions that it tolerates in an employee identified as female at birth.” Accordingly, such discrimination is indistinguishable from sex discrimination.

Justice Samuel Alito, joined by Justice Clarence Thomas, authored one of two dissenting opinions. Justice Alito’s primary points of disagreement with the majority were: (1) the definition of “sex,” as understood by the legislators who authored Title VII, does not include sexual orientation or transgender status; and (2) Congress has had opportunities to amend Title VII to expressly include such protections but has failed to do so.

Justice Brett Kavanaugh’s dissent relied on his interpretation of the “ordinary meaning” of Title VII, which he concluded does not include protections for sexual orientation or transgender status. As such, Justice Kavanaugh reasoned it was not the Court’s role to expand the scope of Title VII. Despite his disagreement with the majority, Justice Kavanaugh’s dissent concluded with a congratulatory note to those he would deny Title VII’s protections, “Millions of gay and lesbian Americans have worked hard for many decades to achieve equal treatment in fact and law. They have exhibited extraordinary vision, tenacity, and grit—battling often steep odds in the legislative and judicial arenas, not to mention in their daily lives. They have advanced powerful policy arguments and can take pride in today’s result.”

The upshot of the Court’s Bostock decision is effectively an expansion of Title VII’s antidiscrimination protections to LGBTQ employees. While many employers already have policies prohibiting discrimination because of sexual orientation and/or transgender status, this decision presumably authorizes EEOC charges and Title VII claims for such discrimination.

© 2020 Dinsmore & Shohl LLP. All rights reserved.

For more on discrimination protections see the National Law Review Civil Rights law section.

NLRB: Federal Court in DC Issues Promised Opinion on Election Regulations

As indicated in our previous blog on this topic, on May 30, 2020, the U.S. District Court for the District of Columbia issued a two page order invalidating five elements of the NLRB’s 2019 election regulation, based on Count One of the plaintiff’s complaint.  On June 7, the court issued its promised memorandum opinion further explaining that order.

The opinion makes three key points.

First, the Court noted that under the Administrative Procedure Act, the norm is for notice and comment rule making.  An exception in the APA, however, permits agencies to forego notice and comment requirements when promulgating “rules of agency organization, procedure, or practice.”  5 U.S.C. Sec. 553(b)(A). The NLRB had relied on this exception to promulgate the election rule without notice and comment. As the Court stated, “The nub of the instant dispute is the NLRB’s valiant effort to shoehorn five parts of its 2019 Election Rule into this narrow classification.” Slip op. at 28.

Following a thorough discussion of the five parts of the rule it had held invalid in its May 30 order, the Court concluded: “[T]he challenged provisions carry many of the indicia of substantive rules — i.e., they grant rights and impose obligations; they produce ‘significant effects on private interests’; and they ‘foreclose alternative courses of action’ or ‘conclusively bind the . . .      affected private parties.’ . . . Therefore, this Court finds the NLRB’s promulgation of these particular [five] rules without engaging in notice-and-comment rulemaking violated the APA.” Slip op. at 42-42 (citation omitted).

Second, the Court found that the five invalidated parts of the election regulation were severable from the remainder of the election rule. The Court rejected AFL-CIO’s argument that the election regulation should be invalidated in its entirety. Slip op. at 43-51. The Court stated that its severability ruling was not prejudical to plaintiffs, however, who are “always free to press an independent basis for setting aside the remainder of the rule and ask the court to do so . . . .” Slip op. at 48 (emphasis in original).

Indeed, the plaintiff’s complaint had three additional counts alleging that the election rule was arbitrary and capricious in whole and in part, and was contrary the National Labor Relations Act.  In a footnote, the Court observed: “[T]he AFL-CIO might well have argued that . . . the Court should . . . proceed to reach the merits of its alternative claims . . . . But for whatever reason, the AFL-CIO maintained that this Court need not reach its other claims, apparently assuming that the Court would agree with its severability analysis.” Slip op. at 48, n. 13.

Third, Court made it clear that the NLRB would have very broad discretion in dealing with the Court’s remand of the remaining rules for consideration in light of the Court’s opinion and order.   “[T]he agency decides what happens next when all or part of a challenged action has been invalidated.”  Slip op. at 46 (emphasis in original).

In a footnote, the Court held: “Thus, no matter how illogical it might seem to this Court for the NLRB to proceed to enforce the remaining portions of the 2019 Election Rule, it is up to the agency to determine which otherwise lawful policy proscriptions it wishes to adopt and enforce, and a simple remand of the matter gives the agency the best opportunity to make that determination in the first instance.”  Slip op. at 47, n. 12.

Following the Court’s May 30 order, the NLRB had swiftly acted to implement the remaining election regulations.  The AFL-CIO also filed a motion for clarification of the May 30 order seeking, among other things, a ruling on the swiftness of the NLRB’s action.  The Court signaled its inclination to deny that motion in its memorandum opinion, stating that “no matter how swiftly the agency undertakes to make that decision  . . . [courts] ‘do not, and cannot, police agency deliberations as a general matter . . . .’ Thus, the AFL-CIO’s recent motion . . . raises an issue that is plainly non-justiciable.”  Slip op. at 48, n. 13.

While the Court’s ruling, and the parties’ respective reactions to it, paint a bit of a muddy picture on what comes next, it is clear that there are still other shoes to drop in this case.  The Board has indicated its intent to appeal the court’s decision invalidating the five elements of the election rule.  The AFL-CIO may re-assert the counts of its complaint not addressed in the Court’s decision, or make additional arguments based on the NLRB’s actions on remand, as further grounds for invalidating the entire election rule.  Or, it may file its own appeal of the Court’s decision seeking appellate review of the Court’s decision not to deal with the other counts in the complaint.

For now, the NLRB will conduct elections in accordance with the undisturbed portions of the election rules, but how they may be impacted by further court litigation is unknown.  It therefore will be very important for employers involved in representation cases to stay up to speed on developments in this dynamic arena.

Copyright © 2020, Hunton Andrews Kurth LLP. All Rights Reserved.

For more NLRB decisions, see the National Law Review Labor & Employment law section.

Mama Always Said, ‘Tell the Truth,’ Especially When It Comes to COVID-19

Since the outbreak of the COVID-19 pandemic earlier this year, employers have been placed in the position of having to deal with numerous conflicting legal and moral obligations.  Prior to the pandemic, by virtue of the Americans with Disabilities Act and similar state and local laws, employers were greatly limited in the questions they could ask perspective and current employees about their individual health conditions.  Similarly, unless they were seeking a workplace accommodation, employees did not have to disclose their personal health conditions to their employer.

In the battle to quell the pandemic, the rules have changed significantly.  Employers have greater leeway to ask questions related to the pandemic and employees who may have medical conditions previously unknown to the employer are disclosing them because of their concerns about increased susceptibility to becoming infected by the virus.  At the same time, getting quick and reliable information about an employee’s COVID-19 status may be difficult.  Frequently, an employee will only receive an initial verbal confirmation of a positive test and have to wait days for the written report.  Complicating matters are reports in the media of employees who have falsely told their employer they tested positive.  In some of the reported cases, upon hearing of a positive test, the employer shut down its entire operation for a deep cleaning only to later have the employee retract their statement they were positive.  In some of these falsification incidents, employees are now facing criminal prosecution.  What is an employer to do?

Trust but Verify

The vast majority of employees are honest and deeply concerned about their employer’s response to COVID-19. Therefore, if an employee reports they have tested positive, the employer should not wait for written verification and immediately begin to follow the Centers for Disease Control or local health authority protocols.  At the same time, employers should take all possible steps to verify the accuracy of what the employee is reporting.

In cases of suspected fraud, here are some steps an employer can and should take:

  1. Require the employee to provide written confirmation.  As noted above, employers should understand that a written confirmation of a positive COVID-19 test may not be immediately available to the employee.  Many test sites provide only a verbal response with the written verification following days later.  Employers should still require written confirmation of the verbal positive result.
  2. While waiting for written confirmation of test results, ask the employee specifically where and when they went for testing and verify the accuracy of that information.  In one case reported in the media, a suspicious HR manager determined that the hospital where the employee claimed to have been tested was not even performing COVID-19 tests.
  3. Carefully examine any written documentation provided by the employee.  Doctor’s notes and other non-detailed information can be verified by a Google search to determine that the practitioner is real.  A phone call to that practitioner should be able to easily confirm the truth of the matter on the documentation.
  4. Communicate to employees in advance that falsification of employee records and information, especially something as critical as a positive COVID-19 test, can be grounds for discipline, including termination of employment.

© 2020 Foley & Lardner LLP

For more on employer’ COVID-19 considerations, see the National Law Review Coronavirus News section.

COVID-19 Daily Self Screening Video

Daily self-screening is one of the simplest ways to help stop the spread of COVID-19. Designed to educate employees, COVID-19 Daily Self-Screening video provides an overview of symptoms and steps a staff member can take to help break the chain of transmission, if they do get sick. Part of a series aimed at supporting a “Work Together, Healthy Together” workplace health and safety program, our videos are intended to be shared with you workforce. In connection with Polsinelli’s efforts to provide resources and support to businesses in our own communities and beyond, we hope you and your team find this valuable.

© Polsinelli PC, Polsinelli LLP in California

Paycheck Protection Program Flexibility Act of 2020 – Changes To The CARES Act

On Wednesday, June 3, 2020, the U.S. Senate passed the Paycheck Protection Program Flexibility Act of 2020 (“Act”) by voice vote.  The bill had passed the U.S. House on May 28 nearly unanimously.  It now heads to the President’s desk for signature.

Summary of Key Provisions

The Act provides important new flexibility to borrowers in the Paycheck Protection Program (“PPP”) in a number of key respects:

Loan Maturity Date: The Act extends the maturity date of the PPP loans (i.e. any portion of a PPP loan that is not forgiven) from 2 years to 5 years.  This provision of the Act only affects borrowers whose PPP loans are disbursed after its enactment.  With respect to already existing PPP loans, the Act states specifically that nothing in the Act will “prohibit lenders and borrowers from mutually agreeing to modify the maturity terms of a covered loan.”

Deadline to Use the Loan Proceeds: The Act extends the “covered period” with respect to loan forgiveness from the original 8 week period after the loan is disbursed to the earlier of 24 weeks after the loan is disbursed or December 31, 2020.  Current borrowers who have received their loans prior to the enactment of the Act may nevertheless elect the shorter 8 week period.

Forgivable Uses of the Loan Proceeds: The Act raises the cap on the amount of forgivable loan proceeds that borrowers may use on non-payroll expenses from 25% to 40%.  The Act does not affect the PPP’s existing restrictions on borrowers’ use of the loan proceeds to eligible expenses: payroll and benefits; interest (but not principal) on mortgages or other existing debt; rent; and utilities.

Safe Harbor for Rehiring Workers: Loan forgiveness under the PPP remains subject to reduction in proportion to any reduction in a borrower’s full-time equivalent employees (“FTEs”) against prior staffing level benchmarks.  The Act extends the PPP’s existing safe harbor deadline to December 31, 2020: borrowers who furloughed or laid-off workers will not be subject to a loan forgiveness reduction due to reduced FTE count as long as they restore their FTEs by the deadline.

New Exemptions from Rehiring Workers: The Act also adds two exemptions to the PPP’s loan forgiveness reduction penalties.  Firstly, the forgiveness amount will not be reduced due to a reduced FTE count if the borrower can document that they attempted, but were unable, to rehire individuals who had been employees on February 15, 2020 (this codifies a PPP FAQ answer discussed on a previous post) and have been unable to hire “similarly qualified employees” before December 31, 2020.  Secondly, the forgiveness will not be reduced due to a reduced FTE count if the borrower, in good faith, can document an inability to return to the “same level of business activity” as prior to February 15, 2020 due to sanitation, social distancing, and worker or customer safety requirements.

Loan Deferral Period: The Act extends the loan deferral period to (a) whenever the amount of loan forgiveness is remitted to the lender or (b) 10 months after the applicable forgiveness covered period if a borrower does not apply for forgiveness during that 10 month period.  Under the unamended PPP, a borrower’s deferral period was to be between 6 and 12 months.

Payroll Tax Deferral: The Act lifts the ban on borrowers whose loans were partially or completely forgiven from deferring payment of payroll taxes.  The payroll tax deferral is now open to all PPP borrowers.

Summary

The Act provides much-needed flexibility to businesses who needed to spend PPP loan proceeds but could not open in order to do so.  As with the initial rollout of the PPP, it will be up to the Department of the Treasury and the Small Business Administration to provide regulations with respect to the Act.

© 2020 SHERIN AND LODGEN LLP

For more on the PPP, see the National Law Review Coronavirus News section.

How Business Owners Can Watch For Fraud

Fraud can quickly take down a successful business, or at the very least create significant issues for you to deal with. As a business owner, it’s important that you know how to watch for fraudulent activities by your employees. Here are a few tips for approaching the subject in your business:

Be careful who you hire

Preventing fraud begins before you even hire your employees. As you work through the selection process, be sure to investigate your potential hires, especially those who deal with finances. You can use a background check, credit report and social media check to look for any red flags.

Protect your business with anti-fraud policies

You should always have company policies in place that state that fraud is not accepted and that includes specific procedures to help prevent and deal with fraud.

Consistent analysis

Use data analysis to double-check the transactions of your business. This can help catch any errors or possible instances of fraud.

Educate your employees

Though you may have the definition of fraud and your stance against it in your company policies, that doesn’t mean that your employees are aware. Especially for new hires, create fraud education and training for them to complete.

Make it easy for whistleblowers to come forward

Create a company culture that is honest and open. This can help draw employees who are willing to call out fraud when they see it. Create procedures that allow whistleblowers to feel safe coming forward and reporting misconduct.

Watch for red flags

As an employer, it’s important to keep an eye on your employees. You have a unique opportunity to spot red flags like employees that live beyond their means or have significant financial struggles.

Don’t let any suspicious activity slide. Be sure to quickly and thoroughly address anything that you notice that could be indicative of fraud.

© 2020 by Raymond Law Group LLC.

Do You Need to WARN Your Employees?

The swift onset of the 2019 novel coronavirus (COVID-19) pandemic caused lost revenue and financial hardship for many employers. Some quickly instituted layoffs as a cost-saving measure. Others went out of business altogether.

Regardless of whether employees suffered job losses as a result of layoffs or business shutdowns, employers may have had, or still have, a duty to provide notice of these job losses under the Worker Adjustment and Retraining Notification Act (WARN Act).

Many states also have their own so-called “mini-WARN” laws. For Wisconsin businesses, the applicable state law is the Wisconsin Business Closing and Mass Layoff Law (WI-WARN).

WHAT IS THE WARN ACT?

The WARN Act protects workers, their families and communities by requiring employers to provide at least 60 calendar days’ advance written notice of a plant closing or mass layoffs affecting certain numbers of employees. Under state law, if applicable, the notice period and the content of the notice may be different.

The purpose of the WARN Act is to provide workers and their families with transition time to adjust to the prospective loss of employment, to seek and obtain other jobs, and, if necessary, to enter skill training or re-training that will allow these workers to compete successfully in the job market.

Typically, obligations under the WARN Act arise when an employer has sufficient advance knowledge of the need for a plant shutdown or mass layoff such that the employer would be able to give employees the required 60 days’ advance notice. The plant closings and layoffs caused by the COVID-19 pandemic, however, were anything but typical. Many employers felt the need to act quickly and, as such, failed to issue WARN Act notices.

DOES THE WARN ACT APPLY TO YOUR BUSINESS?

Coverage under the WARN Act and similar state laws depends on the size of your workforce. Coverage under the WARN Act is triggered by having 100 or more employees in the U.S. In contrast, WI-WARN covers Wisconsin employers with 50 or more employees in the state. Who is considered an employee for purposes of coverage is dictated by statute and generally excludes new and low-hour employees.

DOES THE WARN ACT APPLY TO YOUR LAYOFFS?

The duty to provide WARN Act notice is triggered by either a plant closing or mass layoff, which are defined as:

  • A plant closing (referred to as a business closing under Wisconsin law) is a permanent or temporary shutdown of a single site of employment, or of a facility or operating unit at a single site, that results in an employment loss for 50 or more full-time employees. This threshold is lowered under WI-WARN to 25 or more full-time employees within a single municipality.
  • A mass layoff is defined as any workforce reduction that:
    1. Does not result from a plant closing, and
    2. Creates an employment loss affecting either 50 or more employees and at least 33 percent or more of the employers’ total active workforce at a single site of employment or, alternatively, 500 or more employees. Under WI-WARN this threshold is lowered to 25 employees or 25 percent of the workforce, whichever is greater.

Before jumping to the conclusion that there is a duty to provide WARN Act notice, an employer should carefully analyze whether they are covered under the law and, if so, whether the actions taken meet the plant closing or mass layoff definitions.

ARE THERE EXCEPTIONS TO THE APPLICATION OF THE WARN ACT?

There are many exceptions and nuances under the WARN Act and state law. Two pertinent exceptions in light of the current pandemic are:

  1. Layoffs of less than six months: If a temporary layoff lasts less than six months, an employer is not obligated to comply with the 60-day notice requirements of the WARN Act.
  2. Unforeseeable business circumstances: The WARN Act allows an employer to order a plant closing or mass layoff before the conclusion of the 60-day notice period if the closing or layoff is caused by “business circumstances that were not reasonably foreseeable as of the time that notice would have been required.” A government-ordered closing of an employment site that occurs without prior notice also may be considered an unforeseeable business circumstance.

To date, the U.S. Department of Labor and, in Wisconsin, the Department of Workforce Development, have provided no guidance on whether the business circumstances exception would apply to shutdowns and layoffs caused by the COVID-19 pandemic. Some attorneys and commentators believe that the exception could apply to certain industry sectors such as restaurants, bars and other service-sector employers who were subject to state government-mandated shutdowns.

However, for the majority of employers who have continued to operate as an essential business or are receiving government relief funding such as Paycheck Protection Program funds, the answer is far less clear. It remains to be seen how the state and federal governments will accept this exception in circumstances where operations have continued in some capacity, mass layoffs were contemplated prior to the COVID-19 pandemic or where an employer knows now that it will need to do a mass layoff as soon as federal funding ceases.

WHAT, IF ANYTHING, SHOULD AN EMPLOYER DO?

Employers should consider these six actions:

  1. Determine if you have enough employees to be covered by the WARN Act or state-specific mini-WARN laws.
  2. Calculate whether the employment losses occasioned by a business shutdown or layoff would meet the coverage numbers set forth under applicable law.
  3. In the case of a temporary layoff, determine, to the extent possible, whether it will exceed six months (if not, the WARN Act does not apply).
  4. Because a layoff that lasts more than six months could trigger coverage, it is important to monitor the expected length of any current temporary layoffs. If a layoff is extended beyond 6 months due to business circumstances, notice is required when it becomes reasonably foreseeable that the extension is required.
  5. Even if the unforeseeable business circumstances exception applies, an employer still must provide as much notice as possible under the circumstances. The notice must provide a brief description of why the employer could not provide the full notice period.
  6. Consider whether it makes sense to play it safe and send notices even if the employer hopes to rehire workers within six months. A possible downside to this approach is that it could result in the laid-off workforce being motivated to find other jobs.

The bottom line is that the application of the WARN Act can be complicated. This complication is exacerbated by the fact that the law, while well-intentioned, did not anticipate how it should be applied in the face of a pandemic. If you think you may need to WARN your employees, seek legal counsel to help navigate these complicated laws.

Copyright © 2020 Godfrey & Kahn S.C.

For more on the WARN Act, see the National Law Review Labor & Employment law section.

The CDC Warns Against Using Antibody Testing Results to Make Workplace Decisions

This week, the Centers for Disease Control and Prevention (the “CDC”) released interim guidelines addressing COVID-19 antibody testing. The CDC expressed concerns about the current accuracy of antibody testing and advised businesses against using the results of antibody testing (also known as serologic testing) to make any decisions about returning workers to the workplace.

Although the guidance notes that antibodies may offer some protection from reinfection and may decrease the likelihood that an individual infects others, the CDC has determined that there are myriad issues with the effectiveness of current antibody testing, including widespread false positive results. The CDC guidance states that “additional data are needed before modifying public health recommendations based on [antibody] test results, including decisions on discontinuing physical distancing and using personal protective equipment.” The CDC also recommends that even if individuals have tested positive for COVID-19 antibodies, they should continue to take precautionary measures (such as wearing facemasks) to prevent the spread of infection.

As the U.S. Equal Employment Opportunity Commission (“EEOC”) has not weighed in on this issue to date, it is still unclear whether employers’ use of antibody testing to inform workplace return decisions might implicate the Americans with Disabilities Act (“ADA”) or other discrimination laws.  But given the direct affirmative guidance from the CDC, employers should continue to refrain from using antibody or serologic testing results to determine which workers may return to the workplace.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

ARTICLE BY Corbin Carter at Mintz.
For more CDC Guidance, see the National Law Review Coronavirus News section.