Category: Labor & Employment

FY 2018 H-1B Visa Season Has Started!

h1-b visa seasonPetitions for new H-1B visas are eligible to be filed on April 1, 2017, for federal FY 2018 beginning October 1, 2017. There are a limited number of new H-1B visas each year (65,000 and an additional 20,000 for foreign nationals with a U.S. Master’s degree or higher), which historically is used up within days of the start of the filing period. Last year, 236,000 applications were filed for the 85,000 slots. Now is the time to review your hiring needs.

Given the changing immigration landscape, you should also think about whether you want to file H-1B petitions for foreign students working on Optional Practical Training (OPT) and for employees working in TN or other treaty-based statuses who might be affected by upcoming changes and who you wish to retain.

There are considerable pre-filing requirements, so it is important to get started in order to meet the April 1st deadline.

ARTICLE BY Forrest G. Read IV of Jackson Lewis P.C.

Jackson Lewis P.C. © 2017

United Auto Workers Announces ‘Buy Union American-Made’ Ad Campaign

american-made carsLooking to piggyback off the “keep jobs in America” theme touted by President Trump, the United Auto Workers (UAW) Union announced an ad campaign that urges people to buy union- and American-made cars.  UAW President Dennis Williams said the campaign could be similar to the “Look for the Union Label” jingle in in the 1970s in support of the now-defunct International Ladies’ Garment Workers’ Union. “If it’s not built in the United States, then don’t buy it,” Williams said in news reports.

Williams clarified that the union is urging consumers to buy union-made vehicles first, then those made at non-union factories in the U.S. The union-made then American-made caveat could put the UAW in a tricky spot with Detroit automakers, however, as five of the top eight cars on the 2016 American-Made Index by Cars.com are made by either Toyota or Honda. The Toyota Camry, built in Georgetown, Kentucky, and Lafayette, Indiana, tops the list. By contrast, the popular Ford F-150 pickup did not make the list because it fell below the 75-percent eligibility threshold for domestic-parts content.

The UAW did not specify when the ads might start running or how much they might cost. Presumably, the ads would be funded with UAW members’ dues, which average about two hours’ pay per month.

ARTICLE BY John T.L. Koenig of Barnes & Thornburg LLP

© 2017 BARNES & THORNBURG LLP

Paying Bonuses to Non-Exempt Employees: Avoiding Class-Wide Overtime Violations

overtimeEmployers generally recognize that their non-exempt employees must receive overtime premiums on their base pay – in most cases, their hourly wage – when they work overtime. However, not all employers are as well attuned to the requirement that overtime premiums may also be required on other, “supplemental” components of compensation to nonexempt employees. Bonuses are a common example.

By law, employers are required to pay overtime premiums on non-discretionary bonuses to non-exempt employees when those employees have worked overtime during the timeframe for which the bonus is paid (i.e., whether it is paid on a monthly, quarterly, annual, or other basis). The legal risks involved in violating overtime laws when it comes to non-discretionary bonuses is exacerbated by the fact that this violation is typically repeated as to other non-exempt employees who receive bonuses from the employer. As such, this is a type of violation that plaintiffs’ attorneys often look to bring on a class, collective, and/or representative basis.

However, as suggested by the reference above to “non-discretionary” bonuses, employers are not required to pay an overtime premium on all bonuses. Certain types of bonuses (and other “supplemental” forms of compensation) are excluded from the overtime premium requirement. Federal regulations, which California and other states follow in making these determinations, provide that discretionary bonuses may be excluded. However, this exclusion is very limited. Moreover, like many things in the law, the line between a “discretionary” and a “non-discretionary” bonus is not always clear. Accordingly, employers face risks when they do not pay overtime premiums on bonuses on the premise that the bonus falls under the definition of a “discretionary” bonus. Amongst the guidance provided by federal regulations is that “the employer must retain discretion both as to the fact of payment and as to the amount until a time quite close to the end of the period for which the bonus is paid. The sum, if any, to be paid as a bonus is determined by the employer without prior promise or agreement . . . If the employer promises in advance to pay a bonus, he has abandoned his discretion with regard to it.” Conversely, “[a]ttendance bonuses, individual or group production bonuses, bonuses for quality and accuracy of work, bonuses contingent upon the employee’s continuing in employment until the time payment is to be made and the like” fall in the “non-discretionary” category.

Employers who pay “holiday” or “end of the year” bonuses should also be cognizant of the potential requirement to pay overtime premiums on these payments. Federal regulations provide that “gifts made at Christmas time or on other special occasions, as a reward for service, the amount of which are not measured by or dependent on hours worked, production or efficiency” are excluded from overtime premium requirements. However, in a similar vein, if the amount of the gift, holiday or special occasion award is determined by hours worked, production, or efficiency, this exclusion is lost.

Ultimately, employers who pay bonuses and other forms of “supplemental” compensation to non-exempt employees should be cognizant of the potential requirement to pay overtime premiums on these payments and should consider seeking legal guidance in connection with their bonus programs. The need for proper guidance is especially important due to the class, collective, and/or representative action risks presented by violating this aspect of the law.

ARTICLE BY S. Sean Shahabi of Jackson Lewis P.C.

Jackson Lewis P.C. © 2017

Update: DOL Regulation For Employers Who Use Direct Deposit and Payroll Debit Cards Invalidated

payroll card DOLOn February 16, 2017, the New York State Industrial Board of Appeals invalidated and revoked the NYS Department of Labor regulations we wrote about previously (and updated here) governing payment of wages by direct deposit or payroll debit card. The regulations were scheduled to take effect on March 7, 2017.

As we described in detail in our previous posts, the new regulations would have required employers to provide notice to employees and obtain consent from those who elected to receive wages via direct deposit or payroll debit card. In addition, the regulations would have imposed various restrictions on the terms of use and the fees associated with payroll debit cards.

In its decision, the Board determined that the regulations exceeded the scope of the DOL’s authority and imposed prohibitions that are beyond its purview. Specifically, the Board likened the fees associated with payroll debit cards to the fees associated with checking accounts and licensed check cashers, which are not subject to regulation by the DOL. The Board concluded that the regulations “go beyond regulation of the employment relationship and into the area of banking law, which is outside [the DOL’s] competence and expertise in the regulation of employment and occupational safety and health.” Further, the Board noted that the policy concern which the regulation sought to address – namely, that low wage workers without access to traditional bank accounts will be coerced into receiving wages by payroll debit card – is already covered by Section 192 of the Labor Law, which governs the payment of wages and which requires advance consent from an employee before an employer can pay wages via payroll debit card.

The DOL has not yet indicated whether it will appeal this decision, but we will be sure to keep you updated on any new developments. In the meantime, employers who have taken steps to comply with the regulations can press pause on those plans, but should ensure that their procedures for payment of wages are in compliance with all other applicable laws and regulations.

ARTICLE BY Michael S. Arnold & Brie Kluytenaar of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

©1994-2017 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

R. Alexander Acosta Picked to Head Department of Labor

Alexander Acosta DOLPresident Donald Trump has nominated R. Alexander Acosta to be Secretary of Labor. His nomination comes one day after Andrew Puzder, Trump’s first pick to lead the Department of Labor, withdrew his nomination.

Acosta, currently the Dean of Florida International University’s law school, is the son of Cuban immigrants. If confirmed, Acosta would be the first Hispanic member of Trump’s Cabinet.

Acosta is a graduate of Harvard College and Harvard Law School. He clerked for Justice Samuel A. Alito, Jr. when Alito was a Judge on the U.S. Court of Appeals for the Third Circuit, in Philadelphia. Acosta then went into private practice at the Washington, D.C. law firm Kirkland & Ellis and taught law at the George Mason School of Law.

Acosta has been confirmed by the Senate three times — to become a National Labor Relations Board member, then to become Assistant Attorney General for the Civil Rights Division of the U.S. Department of Justice, and finally when he was nominated to be U.S. Attorney for the Southern District of Florida.

He was appointed by President George W. Bush as member of the National Labor Relations Board, and served as a Board member from December 17, 2002, through August 21, 2003. Acosta reportedly authored approximately 125 opinions during his tenure on the Board.

Thereafter, Acosta served as Assistant Attorney General for the Department of Justice’s Civil Rights Division under President George W. Bush until June 2005. He later was appointed U.S. Attorney for Southern District of Florida, where he served until becoming the Dean of FIU Law in 2009.

ARTICLE BY Linda R. Carlozzi & Philip B. Rosen of Jackson Lewis P.C.
Jackson Lewis P.C. © 2017

Waiting for Gorsuch: SCOTUS Kicks Important Class Action Waiver Case to Next Term

Supreme Court SCOTUS Class Action WaiverLast week, the United States Supreme Court informed litigants in Epic Systems Corp. v. Lewis that it is pushing the case to its October 2017 term. The lawsuit, which rose up through the Western District of Wisconsin and the Seventh Circuit, presents the High Court with a chance to resolve a robust circuit split on the question whether mandatory arbitration clauses in employment contracts may contain class action waivers without running afoul of the National Labor Relations Act (NLRA). Last spring, the Seventh Circuit ruled that such clauses were unenforceable, deviating from rulings by the Second, Fifth, and Eighth Circuits, and prompting the Supreme Court to grant certiorari on January 13, 2017.

The resolution of the issue turns on whether NLRA Section 7’s (29 U.S.C. § 157) protection of employees’ right to engage in “concerted activities” qualifies as a “contrary congressional command” (under CompuCredit Corp. v. Greenwood, 132 S. Ct. 665, 669 (2012)) sufficient to override the Federal Arbitration Act’s (FAA) presumption that arbitration agreements are enforceable as written. The National Labor Relations Board (NLRB) has taken the position for years that class action waivers in employment agreements are unenforceable under the NLRA. See D.R. Horton, Inc., 357 N.L.R.B. 2277, 2289 (2012).  In Lewis, Judge Barbara Crabb of the Western District of Wisconsin followed the NLRB’s interpretation, based on Supreme Court precedent directing courts to give “considerable deference” to the agency’s interpretations of the NLRA. Lewis, No. 15-cv-82-bbc, 2015 U.S. Dist. LEXIS 121137, at *4 (W.D. Wis. Sept. 11, 2015) (quoting ABF Freight System, Inc. v. NLRB, 510 U.S. 317, 324 (1994)).

On appeal, the Seventh Circuit ruled that such class action waivers were “illegal” under the NLRA, making them unenforceable because the FAA contains a “savings clause” that allows courts to refuse to recognize arbitration agreements on grounds sufficient “for the revocation of any contract.” Lewis, 823 F.3d 1147, 1159 (7th Cir. 2016) (quoting 9 U.S.C. § 2). The Seventh Circuit acknowledged that its decision departed from precedents in its sister circuits but dismissed their reasoning. Following Lewis, a divided Ninth Circuit panel joined the Seventh Circuit, deepening the circuit split and teeing the issue up for Supreme Court review.

Because the case has now been deferred until next term, President Trump’s recent nomination of Judge Neil Gorsuch leads inquisitive minds to wonder about his jurisprudence on the FAA. With the Supreme Court’s present four-to-four ideological split, Judge Gorsuch’s vote may well decide the case. The 10th Circuit has not weighed in on the enforceability of class action waivers in employment agreements, but Judge Gorsuch’s opinions on the FAA demonstrate a commitment to enforcing its preference for arbitration.

Just a few weeks ago, in Ragab v. Howard, 841 F.3d 1134 (10th Cir. 2016), Judge Gorsuch penned a dissent from a panel decision that affirmed denial of a motion to compel arbitration. The parties in Ragab agreed to six business contracts with one another, each containing a separate (and contradictory) mandatory arbitration provision, which led the panel to rule that the parties failed to reach agreement on the essential terms regarding arbitration. In his dissent, Judge Gorsuch opined that the parties’ verbal cacophony regarding the procedural details of arbitration did not override their clear intention to arbitrate. His dissent identified two “workarounds” to save the arbitration agreements and alluded to the preemptive force of the FAA over state law. Id. at 1139, 1141. And, in Sanchez v. Nitro-Lift Techs., L.L.C., 762 F.3d 1139 (10th Cir. 2014), Judge Gorsuch joined an opinion requiring three former employees to arbitrate their wage claims against their employer, despite ambiguity in the parties’ arbitration agreement, based on the “liberal federal policy favoring arbitration.” Id. at 1145, 1147-48.

Furthermore, Judge Gorsuch has expressed deep skepticism regarding deference to administrative agencies. Back in August, he authored not one but two opinions in a case called Gutierrez-Brizuela v. Lynch, 834 F.3d 1142 (10th Cir. 2016). In his opinion for the court, Judge Gorsuch ruled that the Board of Immigration Appeals could not apply a new administrative rule retroactively. Id. at 1148. Then, in a separate concurring opinion, he called on the Supreme Court to reconsider the doctrine of Chevron deference to administrative agencies, calling the precedent a “behemoth” of administrative law that was “more than a little difficult to square with the Constitution of the framers’ design.” Id. at 1149. This suggests that the NLRB’s anti-class waiver position may not carry much deferential heft with Judge Gorsuch.

So, while it appears that employers across the country will need to hold tight for a few months longer to see whether the class action waivers in their employment agreements hold water, the wait could be worthwhile for those looking to avoid class adjudication.

ARTICLE BY Aaron R. Wegrzyn of Foley & Lardner LLP

© 2017 Foley & Lardner LLP

Trump Directs Reexamination of the Fiduciary Rule Changes

DOL Fiduciary RulePresident Donald Trump issued a memorandum late last week directing the Department of Labor to reexamine the anticipated changes to the fiduciary rule applying to most retirement plans and individual retirement arrangements. The changes are set to go into effect on April 10, 2017; however, the memorandum directs the Department of Labor to conduct a full review to determine whether to rescind or revise the rule. Initial reports indicated that implementation of the rule was being delayed, but the memorandum ultimately issued by the President did not include a delay. The Department of Labor released a statement following the issuance of the memorandum indicating it would consider its legal options to delay implementation. It is not clear how quickly the Department of Labor may reach a conclusion on a delay of implementation.

The anticipated changes expand the definition of fiduciary under the Employee Retirement Income Security Act of 1974 (“ERISA”) and subject more financial advisors to fiduciary standards under ERISA. The new fiduciary rule is aimed at eliminating a potential conflict of interest by subjecting retirement plan advisors to fiduciary standards under ERISA if the advisor receives variable compensation tied to the investments the advisor recommends to the plan. Advisors could avoid harsh penalties under the rule by providing specific disclosure and agreeing to abide by a “best interest” standard of conduct. We are aware that some advisors were preparing to implement significant business model changes to comply with the anticipated rule changes.

What this means for employers –

  • Employers/benefits committees should evaluate whether they will require advisors to comply with the requirements of the rule despite the memorandum.

  • Employers/benefits committees should reach out to their advisors/consultants and confirm whether they intend to proceed with implementing changes to comply with the rule.

  • Employers/benefits committees should continue to monitor developments in this area from a fiduciary risk perspective.

ARTICLE BY Kevin Selzer of Holland & Hart LLP
Copyright Holland & Hart LLP 1995-2017.

Super Bowl 51: What to Do When Fantasy is Over and Football Fever Becomes Work Reality?

Super bowl 51Super Bowl LI is just around the corner, and many of your employees probably already have football fever. According to a January 2016 study conducted by the Workforce Institute at Kronos, 77 percent of American workers planned to watch Super Bowl 50. So whether they are cheering for the Patriot’s ninth Super Bowl appearance, the halftime show, or the much-talked-about commercials, it’s a safe bet that most of your employees will tune in to at least part of the game day programming. Here are some issues employers may want to consider as they brace themselves for game day fumbles:

1. The fantasy football pool.

Gambling is still illegal in most jurisdictions—even at work and even when it’s just over football. Federal law and most state laws prohibit gambling: the Professional and Amateur Sports Protection Act of 1992 prohibits gambling on sports in most states, and the Interstate Wire Act of 1961 has been interpreted to prohibit online betting. In some states, gambling is a misdemeanor. However, in others, while gambling is generally prohibited, gambling at work may be considered an exception under certain circumstances. Nevertheless, it’s expected that millions of workers will participate in office pools related to the Super Bowl.

Employers may want to take this opportunity to clearly delineate their policies and communicate these policies to employees. To eliminate any confusion, employers may want to relay the state law on gambling to employees and define exactly which acts are covered under the law.

2. A widespread case of the Mondays.

If your Super Bowl party goes as it should, you and your guests might have a little more Monday angst than usual. The 2016 Workforce Institute study suggested that one in 10 workers (approximately 16.5 million U.S. employees) were expected to miss work on the Monday after Super Bowl 50 and that almost 10.5 million employees had requested that Monday off.

Is there anything employers can do to curb employees’ absences on Monday? Two initial considerations when managing employee sick time requests are: (1) whether the employee has sick time available; and (2) whether the employer’s sick time policies are enforced uniformly and all employees are treated equally in terms of their requests.

Employers might be able to decrease the likelihood of employees failing to come in on Monday and create morale-building opportunities by taking some proactive steps. For example, an employer could plan a celebratory work event on the Monday after Super Bowl Sunday. Employees will be itching to talk about the ins and outs of the game and the hot new commercials anyway—they may as well do it around a football-shaped cake while wearing their favorite team’s jersey.

3. Online instant replays.

Employees are not just watching games online; they are also streaming them on social media platforms. Last year, Twitter started carrying live streams of professional football games both on its site and on its app. In 2015, Facebook launched a Super Bowl news feed consisting of a live feed, photos and videos from media outlets, posts from users’ “friends,” live scores, and other ways to interact within the Facebook community. As employees watch games online and on apps, in addition to using the company’s email to communicate, companies might experience performance degradation in their computer networks.

This is a good time to remind employees of your company’s Internet use policies as well as any policy on the appropriate use of company-issued devices such as smartphones and tablets. Whichever course employers take, they should be sure to enforce their technology policies uniformly.

With a little foresight and planning—and a few carefully implemented policies—employers can avoid the blitz when it comes to the Super Bowl and workplace productivity.

ARTICLE BY Hera S. Arsen of Ogletree, Deakins, Nash, Smoak & Stewart, P.C.

© 2017, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.

Right to Disconnect: New Right for French Employees?

right to disconnect FranceA new law, called El Khomri law, passed on August 8th, 2016 in France providing a right to disconnect for employees.

Such right is entered into force on January 1st, 2017

According to the law, it belongs to the employers and the unions to negotiate this new right to determine its modalities of application and of control. Such negotiation should take place in companies having at least 50 employees and should provide for the implementation of mechanisms of regulation regarding the use of the new technologies in order to ensure the compliance with rest times and holidays and the familial and personal life of the employees.

Should no agreement be reached with the unions defining the methods of implementation of the right to disconnect, the employer shall unilaterally elaborate, after having consulted the work’s council committee, a policy which shall need to provide for the training actions and sensitization to the use of digital tools.

However, the idea to enable an employee to disconnect completely outside of his working hours is not new in France.  In 2004, the French Supreme Court had already judged that an employee could not be dismissed for serious misconduct due to the fact that he had not responded to professional solicitations during his lunch break (Cass. Soc. February 17, 2004 n°01-45889).

Furthermore, several collective bargaining agreements applicable in different sectors of industry had already provided for a right to disconnect (e.g. Syntec).

If the title of this right seems simple, its exact nature questions.

Indeed, no legal definition of what is exactly the right to disconnect is given.

The right is generally described as a right for the employee to not be connected to a digital professional tool (email, smartphone…) during off-duty and vacation time.  However, it is not easy to impose the right to disconnect in a professional environment in which the “BYOD” concept has experienced a takeoff without precedent and which therefore has the consequence of dimming a little more the barrier between professional and private life.

However, by sending back to the collective negotiation, the El Khomri law leaves it to unions and employers to guarantee the efficiency of such a right in a manner that matches with the way the company operates.  This relative flexibility obliges them however to be imaginative and to find devices adapted to the nature of the functions occupied by the employees to the variety of the means of communication used, considering evidently the needs of each company.

As such, the right to disconnect is not uniform and can materialize itself in several ways:

  • by a reinforced information of the employees on the use of digital tools (e.g. avoiding to reply to all recipients or to send emails during the week-end or holidays),

  • by the implementation of training actions or sensitization to new technologies (e.g. reminding the employees that they should not send emails after 9.00 pm or the absence of obligation of the recipient to answer emails outside of regular hours),

  • more radically, by automatically redirecting the emails of the employees who are out of the office to an appropriate available employee or the interruption of the professional mailbox during evenings and weekends, or even during holidays.

The new law does not provide for any sanction in case of noncompliance, however, companies should take into consideration that employers failing to implement it will likely be sanctioned by judges on the basis of the necessity to preserve the health and safety of the employees at the workplace as well as the necessity to comply with working time regulations.

ARTICLE BY Cécile Martin of Proskauer Rose LLP

© 2017 Proskauer Rose LLP.

DOL Overtime Rule Appeal Faces Uncertainty

DOL Overtime Rule

Efforts to fast track the appeal of a nationwide preliminary injunction that prevents the U.S. Department of Labor (DOL) from implementing drastic proposed revisions to federal overtime regulations just got “Trumped.”

After obtaining an order in December 2016 to expedite the appeal while President Obama was still in office, attorneys for the federal government filed a short, unopposed motion on January 25, 2017, asking the U.S. Court of Appeals for the Fifth Circuit for a 30-day extension of time to file their reply brief, stating: “The requested extension is necessary to allow incoming leadership personnel adequate time to consider the issues. Plaintiffs’ counsel has authorized us to state that they consent to this extension motion.”

The preliminary injunction that is the focus of the appeal was issued on November 22, 2016, by a federal district court judge in Texas. The injunction halted the implementation of regulatory revisions that were scheduled to go into effect on December 1, 2016, and which would have more than doubled the minimum salary requirements for the major white collar overtime exemptions under the Fair Labor Standards Act (FLSA) from $455 per week to $913 per week.

The DOL already has filed its opening brief on appeal, and the plaintiffs in the case have filed their response. Amicus briefs in support of both sides also have been filed. Absent the requested extension, the DOL’s reply brief is due on January 31. If the extension is granted as requested, the DOL’s reply brief will be due on March 2. However, it also is possible that, after considering the issues, incoming leadership will abandon the appeal.

ARTICLE BY Steven F. Pockrass of Ogletree, Deakins, Nash, Smoak & Stewart, P.C.

© 2017, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.