Category: Labor & Employment

OSHA Clarifies Discipline, Retaliation and Drug Testing Commentary

When the Occupational Safety and Health Administration (OSHA) released its 2016 final rule requiring the electronic reporting of workplace injury and illness reports, it included controversial provisions on discriminatory discipline, retaliation, and even post-incident drug testing by employers. The uproar was instantaneous, with industry groups quickly filing lawsuits challenging OSHA’s authority to enforce the rule. Originally scheduled to go into effect on August 10th, the effective date for the new anti-retaliation rule was pushed back by OSHA until November 1st, and more recently, until December 1st.

In the interim, Dorothy Dougherty, OSHA’s Deputy Assistant Secretary, issued an interpretation memorandum designed to explain the anti-retaliation and injury reporting procedures in more detail. The interpretation may help clarify what your organization must do in order to comply with the final rule – even if it doesn’t make the rule more palatable.

Reasonable Procedures For Employees To Report Workplace Injuries/Illnesses labor law elections

An employer violates OSHA’s new final rule if it either fails to have a procedure for employees to report work-related injuries or illnesses, or its reporting procedure is unreasonable. OSHA states that this requirement is not new, as it was implicit in the previous version of the rule. But now, it is an explicit employer requirement.

OSHA considers a reporting procedure to be reasonable if it is not unduly burdensome and would not deter a reasonable employee from reporting an injury or illness. Examples of what it considers reasonable and unreasonable are as follows:

Reasonable

  • Requiring employees to report a work-related injury or illness as soon as practicable after realizing they have a reportable incident, such as the same or next business day, when possible

  • Requiring employees to report work-related injuries or illnesses to a supervisor through reasonable means, such as by phone, email or in person.

Unreasonable

  • Requiring ill or injured employees to report in person if they are unable to do so

  • Disciplining employees for failing to report “immediately” if they are incapacitated because of the injury or illness

  • Disciplining employees for failing to report before they realize they have a work-related injury that they are required to report

  • Unnecessarily cumbersome or an excessive number of steps to report a work-related injury or illness

In short, if your procedure allows employees to report workplace injuries and illnesses within a reasonable amount of time after they realize they have experienced a reportable event, and the procedure does not make employees jump through too many hoops, it will be reasonable and comply with the final rule.

Anti-Retaliation Provision Explained

Retaliating against employees for reporting work-related injuries or illnesses has long been unlawful. To issue a citation under section 1904.35(b)(1)(iv), OSHA must have reasonable cause to believe that an employer retaliated against an employee by showing:

  1. The employee reported a work-related injury or illness;

  2. The employer took adverse action against the employee (i.e., action that would deter a reasonable employee from accurately reporting a work-related injury or illness); and

  3. The employer took the adverse action because the employee reported a work-related injury or illness.

As in most employment retaliation cases, the third element on causation is often the toughest to prove. The determination is made on a case-by-case basis, depending on the specifics facts in any particular case.

OSHA has focused its commentary primarily on three types of potentially retaliatory actions—discipline policies, incentive programs, and post-accident drug testing. OSHA’s recent interpretation helps shed light on how employers should address these three issues to avoid a citation for a violation of the anti-retaliation rule.

Disciplining Employees For Violating Work Safety Rules

Employers violate the anti-retaliation provision by disciplining or terminating employees for reporting a work-related injury or illness. But, if an employer has a legitimate business reason for imposing discipline, such as the employee’s violation of a workplace safety rule, then there is no retaliation and no violation.

OSHA states that the primary inquiry is whether the employer has treated other employees who similarly violated a safety rule the same way – in other words, did the employer impose the same adverse action regardless of whether the other employees reported a work-related injury or illness. If the rule is consistently applied, then no retaliation exists. However, if the employer disproportionately disciplined employees for violating a rule when they reported workplace injuries, or the employer ignored violations of the safety rule when there was no injury or illness, OSHA may find that the actual reason for the discipline was the reported injury or illness rather than the rule violation.

Incentive Programs

OSHA does not prohibit employers from having safety-related incentive programs. But, it does prohibit employers from withholding a benefit or otherwise penalizing an employee because of a reported injury or illness. OSHA provides this example: if an employer raffles off a $500 gift card at the end of each month in which there are no workplace injuries, such an incentive program would violate the anti-retaliation provision as it withholds the incentive (i.e., the $500 gift card) when an employee reports a work-related injury. On the other hand, an acceptable alternative would be for the employer to raffle off a gift card each month in which employees universally comply with legitimate safety rules, such as using required fall protection and following lockout-tagout rules. The key is whether the employer is withholding a benefit because of a reported work-related injury. Incentive programs that penalize the reporting of injuries and illnesses are likely to result in an OSHA citation.

Post-Accident Drug Testing

One of OSHA’s more troubling and confusing anti-retaliation position is its stance that drug testing employees who report a work-related injury or illness can be considered retaliation. Many employers impose drug testing following any workplace accident or incident that results in injuries. OSHA states that while it does not prohibit employers from drug testing employees who report work-related injuries, employers must have an objectively reasonable basis for such testing.

So what is an objectively reasonable basis for testing? OSHA states that it will consider factors including whether the employer has a reasonable basis for concluding that drug use could have contributed to the injury or illness, whether other employees involved in the incident that caused the injury were also tested (or whether only the employee who reported an injury was tested), and whether the employer has a heightened interest in determining if drug use could have contributed to the injury due to the hazardousness of the work being performed.

In addition, OSHA will consider whether the drug test is capable of measuring impairment at the time the injury occurred, where such test is available. In its interpretive memo, though, OSHA states that at this time, the agency will consider this factor for tests that measure alcohol use, but not for tests that measure the use of any other drugs.

The bottom line is that OSHA is looking whether an employer is using drug and/or alcohol testing as a form of discipline against employees who report a workplace injury, which would be retaliation. Consequently, post-accident drug testing is permitted if all workers involved in the accident are tested in order to gain insight into the cause of the accident. But drug testing an employee whose injury could not possibly be related to drug use, such as a repetitive strain injury, would be seen as retaliation. 

Key Takeaways

Assuming that the anti-retaliation rules survive their legal challenges, employers should prepare to implement a reasonable procedure for employees to report work-related injuries and illnesses. Organizations should review any safety-related incentive programs and remove any punitive effects or withholding of benefits/incentives if an employee reports a workplace injury. When adopting and enforcing drug testing policies, be certain to test all workers involved in a workplace incident, not just those who were injured or reported an injury. And last but not least, be very mindful when deciding to discipline or terminate an employee who has reported a workplace injury or illness. Without a legitimate, well-document business reason for the discipline that is unrelated to the injury report, you may find your business cited for retaliation.

ARTICLE BY Matthew Linton of Holland & Hart LLP
Copyright Holland & Hart LLP 1995-2016.

Texas Judge Not Persuaded, Permanently Enjoins DOL’s New Reporting Rule

Stop, Rain, DOL Persuader ruleIn a major victory for the business community, Judge Sam R. Cummings of the U. S. District Court for the Northern District of Texas issued a permanent nationwide injunction blocking the Department of Labor (DOL) from enforcing its new “persuader” rule. National Federation of Independent Business, et al. v. Perez, et al., Case No. 5:16-cv-00066. The rule attempted to expand disclosure requirements by employers and their consultants (including attorneys) related to union-organizing campaigns.

The new rule, which Judge Cummings had preliminarily enjoined prior to its effective date of July 1 of this year, would have greatly increased the reporting requirements under Section 203 of the Labor Management and Reporting Disclosure Act. That section requires employers and their labor relations consultants to disclose the terms (including financial terms) of any arrangement by which the consultant provides services that are intended to directly or indirectly persuade employees concerning their rights to organize a union or to bargain collectively with their employer.

For years, the DOL took the position that no reporting was required unless the consultant had direct contact with employees by way of in-person meetings, telephone calls, letters, or emails. Similarly, no reporting was required if the consultant’s activities were limited to providing sample materials such as speeches, postings, letters to employees, and the like that the employer was free to accept, reject, or modify.

However, the new persuader rule expanded the disclosure requirements to include indirect contact with employees by the consultant, including:

  • Directing, planning, or coordinating the efforts of managers to persuade employees

  • Providing materials such as speeches, letters, or postings that are intended to persuade employees

  • Conducting union avoidance seminars if the consultant assists the employer in developing anti-union strategies

  • Developing personnel policies intended to persuade employees in the exercise of their organizational or collective bargaining rights.

The attorneys general for 10 states as well as various business groups challenged the new rule as infringing on employers’ First Amendment rights and conflicting with the attorney-client privilege. Judge Cummings agreed that the rule is unlawful and should be set aside. Presently, it is unknown if DOL intends to appeal Judge Cummings’ order.

ARTICLE BY Henry W. Sledz Jr. of Schiff Hardin LLP

© 2016 Schiff Hardin LLP

Workplace Law Under President-Elect Donald Trump: What to Expect

labor law elections

President-elect Donald Trump will assume office on January 20, 2017, with a Republican majority in both the Senate and the House of Representatives. While it is difficult to predict whether the new administration will be able to deliver on President-elect Trump’s campaign promises, we can expect significant policy and enforcement shifts. For example, judicial appointments to the U.S. Supreme Court and other federal courts will have significant and far-reaching implications. This analysis focuses on the likely dramatic impact of the Trump Administration on workplace law.

Courts

The U.S. Supreme Court has been operating with eight justices since the sudden passing of Justice Antonin Scalia in February. There also are many judicial vacancies on the federal bench. President-elect Trump likely will appoint judges more inclined to preserve the strict certification standards for class actions and rein in novel interpretations of laws such as the Americans with Disabilities Act (e.g., on disparate impact and reasonable accommodation issues).

Government Enforcement

Federal agencies increasingly have been aggressive and controversial in their enforcement methods. Under new leadership in the Department of Labor (DOL), the Equal Employment Opportunity Commission (EEOC), and the Office of Federal Contract Compliance Programs (OFCCP), among others, one can expect a return to traditional, more conservative theories of discrimination previously recognized by federal courts. We may see the EEOC ease its systemic discrimination enforcement activity and enforcement position on the ADA, Title VII, and the Pregnancy Discrimination Act. An important issue to watch is the EEOC’s position on Title VII’s application to LGBT issues. Corporate diversity and inclusion programs are not likely to be affected by the new administration, as they are driven much more by demographic changes in the population, labor force, and marketplace and risk management considerations, and much less by federal law and policy in the short-term.

Further, the focus of current controversial regulatory action will change. New DOL leadership may revisit recent DOL proposed or implemented regulations, including those subject to court injunctions. Congress may also now pass legislation to repeal the new DOL overtime rule that raises the salary level for exempt employees effective December 1, 2016, and President-elect Trump might agree. Ongoing challenges to the Occupational Safety and Health Administration (OSHA) final rules (e.g., silica and the electronic recordkeeping rule) may result in settlements that lessen the regulatory impact of the rules. Aggressive enforcement coupled with significant publicity and fines have been key tools implemented by the current administration. Under new leadership, these agencies may ease back on such aggressive approaches and offer greater cooperation to the employer community as they try to balance the purposes of the law with business realities.

Executive Orders and Actions

President-elect Trump has announced an intention to undo President Barack Obama’s Executive Orders, many of which impose significant employment-related prohibitions and requirements on government contractors. The new administration likely will rescind at least some of those Executive Orders, chief among them the controversial Fair Pay and Safe Workplaces Executive Order.

In addition, President-elect Trump has stated he will reverse the Deferred Action for Childhood Arrivals (DACA) and Deferred Action for Parents of Americans (DAPA) Executive Actions. It is unclear whether this would only address the enjoined executive relief programs or also include revocation of work authorization documents for currently eligible workers under DACA.

EEO-1 Pay Data Reporting

Final rules revising the EEO-1 report to add W-2 earnings and work hours reporting are scheduled to go into effect in early 2018. The new administration may consider rescinding the changes before first reporting is due in 2018 or revising the reporting to ease the burden on employers.

National Labor Relations Board (NLRB)

Currently, the NLRB has a 2-1 Democratic majority, with two vacant seats. Since the President traditionally has had the opportunity to appoint Board members to achieve a majority along political lines, the open seats likely will be filled by Trump appointees. This will create a more business-oriented NLRB. A new Board with a Republican majority is likely to revisit recent NLRB rules and decisions, including those covering (1) class action waivers, (2) joint employers, (3) inclusion of temporary workers in bargaining units with an employer’s regular workers, (4) quickie elections, (5) expansion of protected concerted activity (e.g., its impact on workplace policies), (6) definition of appropriate bargaining units, and (7) status of college/university adjunct faculty, graduate students, and student athletes. The new Board also may not make additional changes the current Board would make, such as extending Weingarten rights to non-union workplaces and making misclassification of employees as independent contractors a separate violation of the National Labor Relations Act (NLRA). In addition, the Labor-Management Reporting and Disclosure Act (LMRDA) “persuader” regulations, which are currently enjoined, may be revisited.

Sarbanes-Oxley Act and Dodd-Frank Act

During the campaign, President-elect Trump singled out the Dodd-Frank Act of 2010 (DFA) as making it impossible for banks to lend money to businesses for the purpose of creating jobs. A repeal of the DFA might encourage Congress and the Securities and Exchange Commission to rely more heavily on the Sarbanes-Oxley Act of 2002 (SOX) whistleblower provisions and thus mandate that corporate compliance programs, as developed by publicly traded companies, be increasingly robust, providing for greater “self-regulation.” Further SEC enforcement actions regarding confidentiality agreements likely will decrease.

Affordable Care Act (ACA)

President-elect Trump has vowed to repeal and replace the ACA. The extent to which this comes to fruition, the timing of any dismantling efforts, and the types of replacements that are offered will be of utmost importance to employers. While there has been much mentioned in broad brush strokes about a full repeal, it is unlikely that that can or will occur. Alternatives, such as the reliance on private healthcare savings accounts, market-based universal coverage and allowing for insurance plans to be offered across state lines have been floated, however, there is no Republican consensus on what the path away from the ACA will look like. Employers will be eager to see what is done to change and lessen employer obligations under the ACA, but for the meantime, will have to stay the course.

Fiduciary Rule

The DOL’s fiduciary rule concerning the expanded definition of who is considered a fiduciary under the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code, as well as certain exemptions addressing conflicts of interest, also may be subjected to increased scrutiny in light of the President-elect’s opposition to the current administration’s financial initiatives and, more generally, “unnecessary” regulations. It is hard to determine at this point where these types of regulations on fiduciary status and conduct will rank among a long list of priorities for the new administration.

Federal Tax Reform

President-elect Trump has promised sweeping federal tax reform, including tax cuts for corporations. While the viability of implementing such changes rests with the Republican Congress, the lack of specificity as to what tax reform would look like under the new administration leaves many questions. These questions include how tax reform may affect benefits plans and arrangements, such as qualified retirement plans, fringe benefits, and executive compensation arrangements.

E-Verify

The new administration may focus on expanding enforcement of existing immigration laws in the workplace, which may include encouraging more employers to use E-Verify under existing law, as well as working with Congress to expand mandatory use of E-Verify. Under current federal law, E-Verify is voluntary for employers, except as mandated by executive order for federal government contractors.

International

The new administration may suspend temporarily the issuance of visas to certain countries and regions designated as high risk. President-elect Trump has indicated he will ask the Department of State, Department of Homeland Security, and the Department of Justice to begin a comprehensive review of high-risk visa cases to develop a list of regions and countries for which visa issuance will be suspended until a proven and effective vetting mechanism is implemented. Individuals from countries such as Syria, Iraq, Libya, and other designated high-risk areas, or individuals who have traveled to such countries, will face even longer delays obtaining visas for both short- and long-term travel to the U.S. In addition, global mobility may be affected if the U.S. restricts or delays business visas, resulting in reciprocal treatment by the affected countries.

U.S. companies operating in major European markets and other countries with strong labor interests may encounter increasingly complex labor relations and works council issues, as the United States is perceived as more nationalistic and less deferential to local employee protections. Further, there may be increasing pressure from foreign vendors, suppliers, customers, and employees on U.S. companies to certify that they will comply with ILO standards.

Post-Employment Restrictions

The new administration is unlikely to continue attempts to prohibit non-compete agreements we have seen from the White House over the past months, at least on a federal level. On a state level, legislatures still may respond to the Obama Administration’s “call to action” and introduce measures to curb the use of non-compete agreements, as, for example, has been promised by New York State Attorney General Eric Schneiderman.

The “Antitrust Guidance for Human Resource Professionals,” issued by the Department of Justice and Federal Trade Commission, is not likely to continue as a priority for the new administration. The guidance promised criminal prosecution of human resource professionals who, for example, enter into “naked” no-poach agreements.

Trade Secret Protection

Adding to the bi-partisan federal Defend Trade Secrets Act, which provided a civil right of action under the Economic Espionage Act, a new administration may adopt protectionist policies, bringing further enforcement efforts to misappropriation of trade secrets flowing to foreign powers, including to China.

Cybersecurity

President-elect Trump has expressed a desire to reduce, rather than increase regulation. However, political party hacking and unfavorable email dumps from WikiLeaks, coupled with continued data breaches affecting privacy and public sector entities, may prompt the new President and Congress to do more. Politics aside, cybersecurity is a top national security concern, and it is having a significant impact on private sector risk management strategies and individual security.

DOL Opinion Letters

The long-standing practice of the Administrator of the Wage and Hour Division of the DOL issuing official opinion letters regarding application of the Fair Labor Standards Act (FLSA) upon which employers rely may make a comeback. In recent years, the DOL had stopped issuing opinion letters, choosing instead to issue less frequent “Administrator Interpretations” with wider applicability and scope, but less specificity. Two significant Administrator Interpretations concerned “joint employment” and “independent contractor” status under the FLSA. Both have been viewed as clear efforts to expand the rights of workers under the law and place additional burdens on employers. New opinion letters are issued on a variety of topics and could scale-back or withdraw the Obama Administrator Interpretations, permitting employers greater flexibility in using independent contractors and giving business more certainty in expanding through use of franchises.

White Collar

The President-elect has been critical of excessive and unnecessary government regulation in such areas as health care, energy, and the environment. We may see a decreased investigatory focus in these areas, and fewer federal prosecutions of health care organizations, pharmaceutical companies, and manufacturers.

Focused on security and protecting the homeland, the new administration may enhance emphasis on international terrorism investigations, import/export violations, and immigration offenses.

Given his pledge to improve life in “inner city” areas, we should expect greater resources and attention to be devoted to the prosecutions of criminal activity by violent gangs and an effort to address crimes that affect the daily lives of the residents of America’s cities.

***

An important question for many, especially those that operate in multiple states and must comply with the current patchwork of state laws on data breach and sick leave, for example, is whether a federal law that supersedes state law is likely. With Republicans in control of the executive and legislative branches, that remains to be seen.

ARTICLE BY Howard M. Bloom & Philip B. Rosen of Jackson Lewis P.C.

Jackson Lewis P.C. © 2016

Arizona Voters Approve Paid Sick Leave for Employees and Minimum Wage Increase

Arizona Minimum Wage and Paid Sick Time OffThe election results are in, and President-elect Donald Trump’s victory over Secretary Hillary Clinton has the nation abuzz and undoubtedly will for the foreseeable future.  However, the Presidential race was not the only notable race or measure on the ballot.  Although the dust hasn’t quite settled from last night’s historic vote, there a number of approved ballot measures that employers will need to understand and prepare for immediately.

Specifically, in Arizona, the Minimum Wage and Paid Sick Time Off Initiative, also known as Proposition 206, passed by a 59% to 41% margin.  The paid sick time component of the law will go into effect July 1, 2017, while the minimum wage increase begins in just a few months by raising the Arizona minimum wage to $10.00 per hour effective January 1, 2017.

The first component of the new Arizona law inserts Article 8.1 entitled “Earned Paid Sick Time” into Section 5, Title 23, Chapter 2 of the Arizona Revised Statutes.  The new paid sick time law applies to covered employers regardless of the number of employees; a covered employer with at least one Arizona employee is obligated to comply with the law.  Accrued paid sick time may be used for the employee for his or her own mental or physical illness, injury or health condition; or to care for a family member’s – as the term family member is defined under the statute – mental or physical illness, injury or health condition.  Here are the major points of emphasis:

All employees will accrue paid sick time at a minimum rate of one hour for every 30 hours worked for the employer.

Employees of an employer with 15 more employees may cap maximum annual accrual of paid sick time at 40 hours, while smaller employers may cap the maximum annual accrual at 24 hours.

Employees who are exempt under the Fair Labor Standards Act of 1938 (“FLSA”) will be assumed to work 40 hours in each work week for purposes of calculating paid sick time accrual, unless their normal work week is less than 40 hours, in which case earned paid sick time accrues based on actual hours worked.

Unused earned paid sick time must be carried forward to the following year consistent with the accrual limits of the statute. Employers may forego this requirement by following a procedure specified in the statute.

A 90-day probationary period for new employees may apply to the use, but not accrual, of paid sick time.

The new law includes specific employee protections making it unlawful for an employer to retaliate or discriminate against an employee for exercise of his or her use of paid sick time.

Further complicating the new law will be the statutory provision allowing employers to do away with the accrual method in favor of simply providing an employee at the beginning of the year all earned paid sick time that an employee is expected to accrue during the year.  (This provision brings Arizona’s law relatively on par with neighboring California’s paid sick time law.)  The new Arizona law contains other provisions explaining issues such as an employer’s ability to pay its employees for earned, unused paid sick time rather than carrying it forward to the next year; notice required by the employee for use of paid sick time; and the employer’s ability to request documentation to verify proper use of paid sick time.   Notably, the law does not require the payment of accrued but unused paid sick time upon termination of employment.

Employers should note that the provisions of the new paid sick time law are minimum requirements, and nothing in the new law prevents an employer from establishing a more generous policy or continuing one already in place.

The second component of the new Arizona law adjusts Arizona Revised Statute § 23-363 to require a gradual increase of Arizona’s minimum wage beginning this coming January.  Arizona’s new minimum wage will be $10.00 per hour effective January 1, 2017.  Thereafter, the minimum wage will be raised to $10.50 effective January 1, 2018, $11.00 effective January 1, 2019, and $12.00 per hour effective January 1, 2021.  Beginning in 2021, the minimum wage will continue to be adjusted annually based on Arizona’s cost of living.  Employers with employees who customarily and regularly receive tips as part of their income may continue to pay employees $3.00 less than the minimum wage in accordance with Arizona’s minimum wage act if the employer can prove the employee is earning at or beyond the minimum wage after tips are counted.

Arizona’s passing of Proposition 206 continued a national trend of answering demands for paid sick time and increasing the minimum wage.  Maine and Colorado also agreed to raise the minimum wage, while Washington voters approved of both a minimum wage increase and to provide paid sick leave for employees in similar fashion to Arizona’s measure.

Arizona employers are encouraged to reach out to local employment attorneys for additional guidance or as questions may arise.

ARTICLE BY Daniel B. Pasternak of Squire Patton Boggs (US) LLP
© Copyright 2016 Squire Patton Boggs (US) LLP

UK Employee Classification: Uber Drivers Uber Happy

Uber employee ClassificationAs you may have seen from the extensive press coverage, the UK Employment Tribunal has delivered its much anticipated judgment in Aslam and Farrar v Uber. The case was about whether Uber drivers are self-employed contractors, or are “workers” with rights to minimum wage, statutory holidays, sick pay and breaks, amongst other workers’ rights.

In Depth

A “worker” is someone who has entered into a contract to personally do work for, or provide services to, a third party. This contract can be implied and does not have to be in writing. If that third party is a customer of the individual’s business undertaking, however, then that individual is self-employed.

Determining the status of the relationship between businesses and those they engage involves the Employment Tribunal looking beyond the terms and conditions in place between the parties to the reality of the relationship. The Tribunal will look at a number of factors to determine the true status of the relationship, but what really matters is the Tribunal’s view of how much control the business exerts over the individual, and whether or not that tips the balance away from the individual truly having the autonomy of being self-employed.

Uber’s Position

Uber said that it did not have the necessary control over drivers because

  • It is just a “platform” (through the Uber app) that links fare-paying customers to Uber drivers, rather than a transportation business.

  • Once linked, the Uber driver uses his/her own vehicle to take the customer to the requested destination.

  • There is no obligation on the drivers to work and drivers are not performance managed or subject to disciplinary procedures, although they do receive a “rating” from customers at the end of the journey.

  • Uber does not “pay” the drivers.  The drivers receive the fare paid by the customer (collected by Uber through the platform), after the deduction of Uber’s service fee. The service fee to Uber is taken as payment for the use of the app.

  • The drivers pay for the vehicle, the expenses associated with running that vehicle and their own taxi licenses.

  • It is the end-user (Uber’s customers) who contract with the drivers; they engage the drivers as self-employed contractors.

  • The drivers accept their self-employed status for tax purposes.

  • The drivers are permitted to work for other organisations, including direct competitors of Uber; they are not required to work exclusively for Uber.

The Employment Tribunal’s Decision

The Tribunal was not persuaded by Uber’s arguments nor, in relation to some aspects, Uber’s perspective on how its business operated. The Tribunal found that Uber was, indeed, running a transportation business through which the drivers provided skilled labour, from which Uber profited. The key factors were

  • That the drivers can only use the Uber app on Uber’s terms.

  • Uber interviews and “recruits” the drivers.

  • Uber handles customer complaints and often compensates customers following these complaints. Uber’s findings in respect of customer complaints are not always shared with the driver.

  • Uber accepts liability for losses, e.g., refunds to passengers, which would usually fall to a driver who was genuinely self-employed.

  • Uber does pay the drivers.

  • Uber’s ratings system (whereby the customer would rate the driver following the completion of a journey), is essentially a performance management procedure that could result in the driver being disconnected from the app.

  • Fares are fixed by Uber.

  • The language used by Uber in its PR communications is inconsistent with their argument that the drivers are self-employed.

What’s Next?

Uber has confirmed to customers and the press that it will be appealing the decision. In order to get an appeal off the ground, however, Uber will need to identify an error of law in the Tribunal’s judgment, or show that it had reached a decision which no reasonable tribunal could have reached on the facts.

How Does This Affect My Business

The analysis of an individual’s employment status will depend on the facts of each individual case. The Uber judgment therefore does not necessarily mean that all companies within the gig economy, or who engage self-employed contractors, must now give these individuals workers’ rights.

It does, however, serve as a useful reminder to review your workforce, consultancy/contractor agreements and other documents/communications and processes. Keep in mind, however, that were there to be a dispute over the status of the working relationship, a tribunal or HMRC would look beyond the contractual documents to the true relationship of the parties.

ARTICLE BY Katie L. Clark & Paul McGrath of McDermott Will & Emery

© 2016 McDermott Will & Emery

Non-Competes Call to Action, Transgender Bathrooms, Texas Court Blocks Blacklisting Rule: Employment Law This Week November 7, 2016 [VIDEO]

White House Issues Call to Action on Non-Competes

Our top story: The White House issues a call to action. The administration is calling on states to combat what it describes as the “gross overuse of non-compete clauses today.” The statement recommends legislation banning non-competes for certain categories of workers and prohibiting courts from narrowing overly broad agreements. New York Attorney General Eric Schneiderman answered the call immediately, announcing that he would introduce relevant legislation in 2017.

“President Obama’s call to action encouraged states to take action to do three things. One, to ban non-competes for certain types of employees, such as low-wage earners; two, to increase transparency in the way that employers communicated with employees about non-competes; and three, to incentivize employers to write non-competes that are enforceable. … It used to be that non-competes were subject to scrutiny in the courtroom, but now we’re seeing that scrutiny also in the media and in the political arena. … With scrutiny of non-competes occurring in additional fora, it’s important for employers to review their non-competes, both to make sure that they are enforceable and to make sure that they’re administered to appropriate levels of employees.”

High Court Will Hear Transgender Bathroom Case

The Supreme Court will examine the definition of “sex discrimination.” The High Court has agreed to hear a case involving a transgender student and his use of the boys’ bathroom at school. The legal issue at the center of the case is the interpretation of regulations implementing Title IX, which bans sex discrimination in schools. The Department of Education has put out guidance interpreting “sex discrimination” to include claims based on gender identity, and the Fourth Circuit deferred to that interpretation in this case. This case could have implications for other laws that prohibit sex discrimination, including Title VII of the Civil Rights Act.

Texas Court Blocks Fair Pay and Safe Workplaces Regulations

Federal contractors get a reprieve from the “blacklisting” rule. A Texas federal court issued a temporary nationwide injunction on portions of the Fair Pay and Safe Workplaces rule. The executive order includes controversial disclosure requirements for government contractors and restrictions on arbitration. The district court ruled that the prohibition on certain arbitration agreements conflicted with the Federal Arbitration Act, and the reporting requirements could allow contractors to be disqualified from obtaining contracts without due process.

New York City Council Passes First Freelancer Wage Protection Law

The New York City Council has passed the nation’s first legislation bolstering protections for freelancers. The “Freelance Isn’t Free” Act, which passed unanimously, implements penalties for employers who do not pay freelance workers within 30 days of services rendered. In addition, the Act requires a written contract for freelance work worth $800 or more. The contract must include an itemized accounting of the work to be performed and the rate of pay. Mayor Bill de Blasio is expected to sign the bill.

Tip of the Week

Brian Chevlin, Senior Vice President and General Counsel for Pernod Ricard USA, is here with some advice on how to build a committed legal team through a culture of appreciation.

ARTICLE BY

George Carroll Whipple, III
Epstein Becker & Green, P.C.
©2016 Epstein Becker & Green, P.C. All rights reserved.

US Voting Leave Laws: What Employers Need to Know

US Voting Leave LawsWith the general election days away, employers should familiarize themselves with their state’s voting leave laws.

Voting leave laws vary across the country. A number of states, however, do not have specific laws permitting time off to vote. These states include: Connecticut, Delaware, Florida, Idaho, Indiana, Louisiana, Maine, Michigan, Mississippi, Montana, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, Washington, and the District of Columbia.

Generally, states with voting leave laws grant an employee two hours off work, in order to vote, without experiencing loss of pay. An employee who has sufficient hours to vote outside his or her working hours is generally not eligible to take time off work to vote without experiencing loss of pay. Some states may fine employers who violate an employee’s statutory right to take time off work to vote.

Below is a summary of states’ voting leave laws:

Alabama: An employee may take up to one hour off work to vote, upon reasonable notice to his or her employer, unless the employee’s hours of employment begin at least two hours after the polls have opened or end at least one hour before the polls close. The employer may specify the hours when an employee may take off work to go vote. (Code of Ala. § 17-1-5)

Alaska: An employee may take off as much working time as necessary to vote, without loss of pay. If, however, an employee’s working hours begin either two hours after the polls have opened or two hours before the polls close, the employee is considered to have sufficient time outside working hours within which to vote and may not take time off to vote without incurring loss of pay. (Alaska Stat. § 15.15.100)

Arizona: An employee may take time off work to vote, upon notice to the employer prior to election day, if there are less than three consecutive hours between the opening of the polls and the beginning of the employee’s work shift or between the end of the employee’s work shift when the difference between work shift hours and opening or closing of the polls provides a total of three consecutive hours. The employee shall not experience loss of pay for work time taken to vote and the employer may specify the hours when an employee may take off to vote. Employers refusing an employee’s right under this statute or subjecting an employee to a penalty or reduction of wages is guilty of a class 2 misdemeanor. (A.R.S. § 16-402).

Arkansas: Employers must schedule employees’ work hours in such a way that each employee has an opportunity to go vote. An employer’s failure or refusal to comply with this statute may result in a fine of no less than $25 and no more than $250. (A.C.A. § 7-1-102).

California:  An employee without sufficient time outside working hours may take off as much time as necessary at the beginning or the end of a work shift in order to vote. An employee may not lose pay for less than two hours taken off to vote. (Cal. Elec. Code § 14000).

Colorado: With notification to the employer prior to Election Day, an employee may be absent from work for up to two hours in order to vote without incurring loss of pay. The employer may specify the hours when the employee may be absent, but the employee may request that the hours be at the beginning or end of the work shift. An employee with three or more off-duty hours between the time of opening and closing of the polls may not take time off work to vote without incurring loss of pay. (C.R.S. 1-7-102).

Georgia: Upon reasonable notice to the employer, an employee may take off up to working hours to vote unless the employee’s working hours beginning at least two hours after the opening of polls or end at least two hours before polls close. The employer may specify during which hours an employee may take off work to vote. (O.C.G.A. § 21-2-404).

Hawaii: An employee may take off work up to two hours to vote without incurring loss of pay. If an employee fails to vote after taking time off for that purpose, the employer, upon verifying that fact, may deduct appropriate wages or salary from the employee for the period during which the employee was absent from employment for purposes of voting. An employer who refuses an employee’s privileges conferred by this statute may be subject to a fine of not less than $50 and not greater than $300. (HRS § 11-95).

Illinois: Upon notice to an employer prior to Election Day, an employee may take off up to two hours from work to vote without loss of pay if the employee’s working hours begin less than 2 hours after polls open and less than 2 hours before polls close. The employer may specify the hours when the employee may take off work to vote. (10 ILCS 5/17-15).

Iowa: With a written request made prior to Election Day, an employee, without three consecutive off duty hours between the time of the opening and closing of polls, may take such time off work as necessary to grant the employee a total of three consecutive hours to vote, without loss of pay. (Iowa Code § 49.109).

Kansas: An employee may be absent from work for no more than two consecutive hours between the time of opening and closing of polls. If polls are open before the employee is scheduled to begin work or after ending work, but the period of time the polls are open is less than two consecutive hours, then the employee can only take off as much time to grant the employee two consecutive hours to vote. (K.S.A. § 25-418).

Kentucky: An employee, having applied for leave prior to Election Day, may take up to four hours off work, between the time of opening and closing the polls, to vote without loss of pay. The employer may specify the hours during which an employee may take off work to vote. (KRS § 118.035).

Maryland: An employee may take up to two hours off work to vote if the employee does not have two continuous off-duty hours during the time that polls are open. The employer shall pay the employee for up to two hours taken off work to vote. (Md. Election Law Code Ann § 10-315).

Massachusetts: An employee in a manufacturing, mechanical, or mercantile establishment may take time off work during the two hours after the opening of polls, upon application for leave of absence during such period. (ALM GL ch. 149 § 178).

Minnesota: An employee may be absent from work for the time necessary to cast a ballot and return to work on that same day without loss of pay. An employer hindering an employee’s right under this statute is guilty of a misdemeanor. (Minn. Stat. § 204C.04).

Missouri: Upon request made prior to Election Day, an employee may take off three hours from work between the time of opening and the time of closing the polls for purposes of voting. The employer may specify the hours when the employee may take off work to vote. (§ 115.639 R.S. Mo.).

Nebraska: An employee who does not have two consecutive off-duty hours in the period between the time of the opening and closing of the polls may take off work two consecutive hours to cast a ballot and without loss of pay. The employer may specify the hours during which the employee may take off work to vote. (R.R.S. Neb. § 32-922).

Nevada: If it is impracticable for an employee to vote before or after his or her hours of employment, an employee may be absent from his or her place of employment at a time designated by the employer to provide for enough time to vote. An employee shall not experience loss of pay for time taken off to vote. (Nev. Rev. Stat. Ann. § 293.463).

New Mexico: An employee may take off work up to two hours for the purpose of voting without loss of pay unless the employee’s work shift begins two hours after polls open or ends three hours before polls close. An employer refusing an employee’s right granted by this statute is guilty of a misdemeanor and may be punished by a fine not less than $50 and not more than $100. (N.M. Stat. Ann. § 1-12-42).

New York: An employee without four consecutive off-duty hours either between the opening of the polls and the beginning of his or her working shift, or between the end of his working shift and the closing of the polls, may take as much time off from work to vote. An employee may take off up to two hours of work without loss of pay. An employee seeking to take time off work to vote must notify the employer between two to ten days before the election requiring time off work. No less than ten working dates before an election, employers must post in the workplace a conspicuous notice notifying employees of their rights under the statute. Such notice shall be posted until the close of polls on Election Day. (NY CLS Elec § 3-110).

North Dakota: Employers are encouraged, but not required, to establish a program to grant employees time off work to vote when the employee’s regular work schedule conflicts with the polls opening and closing time. (N.D. Cent. Code, § 16.1.01-02.1).

Ohio: Employers cannot discharge or threaten to discharge an employee for taking a reasonable amount of time off work to vote on Election Day. An employer who violates this section may be fined not less than $50 and no more than $500. (ORC Ann. 3559.06).

Oklahoma: Upon oral or written notice by the employee prior to Election Day, an employer must grant an employee two hours off from work, during the period when polls are open, to allow the employee to vote. The employer may select and notify the employee of the work hours that may be taken off to vote. Employees taking time off work to vote shall not experience loss of pay or other penalty, for such absence. An employer failing to comply with this statute may be guilty of a misdemeanor and may subject to a fine between $50 and $100. (26 Okl. St. § 7-101).

South Dakota: An employee without two consecutive off duty hours during the time polls are open may take off two hours from work in order to vote without loss of pay. The employer may specify the hours during which the employee may take off work to vote. An employer refusing an employee’s right under this section is guilty of a Class 2 misdemeanor.

Tennessee: An employee, upon notice to the employer before noon of the day before Election Day, may take off three hours from work during the time the polls are open, without loss of pay, in order to vote, unless the employee’s work shift begins three hours after polls open or ends three hours before polls close. The employer may specify the hours during which the employee may be absent. (Tenn. Code Ann. § 2-1-106).

Texas: An employer may not bar an employee from taking time off from work on Election Day for the purpose of voting. An employer in violation of this statute may be guilty of a Class C misdemeanor. (Tex. Elec. Code § 276.004).

Utah: Upon application prior to Election Day, an employer must allow an employee to take off from work up to two hours, between the time the polls open and close, in order to vote upon. An employee who has three or more consecutive off duty hours between the times polls open and close is not eligible to take time off work under this statute. An employer violating an employee’s rights under this statute is guilty of a class B misdemeanor. (Utah Code Ann. § 20A-3-103).

West Virginia: Upon written request made to the employer at least three days prior to Election Day, an employee may take off up to three hours from work in order to vote. An employee shall not experience loss of pay for time taken off work to vote. An employee with three or more off duty hours between the hours of the opening and the close of polls on Election Day may not take time off work to vote without loss of pay. (W. Va. Code § 3-1-42).

Wisconsin: Upon notification to the employer prior to Election Day, an employee may take off up to three hours from work to vote. The employer may specify the hours when the employee may take off work to vote and the employee shall not experience loss of pay. (Wis. Stat. § 6.76).

Wyoming: An employee may take off one hour from work in order to vote without loss of pay. (Wyo. Stat. § 22-2-11).

ARTICLE BY Ingrid Cepero of Squire Patton Boggs (US) LLP
© Copyright 2016 Squire Patton Boggs (US) LLP

Social Media Policy Checklist For Employers

Social Media PolicyA social media policy or a set of guidelines helps your employees make smarter decisions when marketing your brand, products and services online and may mitigate the risk of coming under the radar of the FTC or another regulatory agency or simply avoiding bad PR.

Key Players.  Legal should play a key role in creating a social media policy or set of guidelines, but it is wise to involve personnel from marketing, IT, and HR.   Also consider including representatives from a selection of departments to get valuable input from employees that the policy is intended to guide.

Identify and Evaluate.  Before drafting a social media policy, the key players must carry out internal due diligence.

  • Identify and evaluate the categories of confidential information that your employees have access to and may inadvertently share on social media.
  • Identify and evaluate the type of content that employees post on social media platforms.  Is the content generally created in-house?  By an ad agency?  From other third-party sources?  Are social media campaigns usually text-only or do they include photos, music, videos, endorsements?  Understand the legal issues associated with posting content online.
  • Identify and evaluate other legal risks associated with the use of social media in your business, including third-party terms of use, employment laws, privacy claims, securities laws and other laws that may be triggered by the use of social media by employees. For example, the National Labor Relations Board has found overly restrictive social media policies to violate employees’ protected rights.

Purpose and Scope.  The policy should reflect the type of social media engagement that your company and employees actually use.  For example, does your company maintain a Facebook® page or a blog?  Use LinkedIn® to post articles?  Run promotions on Instagram®?  Do your employees use personal social media accounts to post on behalf of the company or only employer-created accounts?  The answers to these questions will affect the types of social media guidelines that you should create for your employees.

Be Practical, Positive and Consistent.  The policy should be easy to read and interpret.  The intent is not to discourage social media use, but to make use smarter.  Try to phrase the guidelines as things employees “can” do rather than cannot do.  Use terms that employees engaged in social media will understand.  For example: avoid using terms from the Copyright Act such as “reproduce, distribute or display,” and instead use “post, tweet or pin.”  The policy should also match the general values and culture of your company and the other policies that you may have in place that overlap with social media policies.

Training.  Training is essential.  Do not just add the policy to the employee handbook and hope that your employees will read it.  Explain why social media guidelines are important to the company and the company’s reputation and relationship with customers, vendors and other third parties.  Explain the legal risks of “social media posts gone wrong.”  Arrange a lunch and learn to walk through the policies and provide examples of “Dos and Don’ts.”  Create a short checklist of key takeaways from the policy and post the checklist in areas where employees who regularly post on social media work.

Monitor and Re-visit.  Monitor compliance and ensure enforcement is uniform.  Social media changes quickly, so the policy should also be re-visited frequently to make sure that new forms of social media engagement are captured.

ARTICLE BY Orla M. O’Hannaidh of Womble Carlyle Sandridge & Rice, PLLC

Copyright © 2016 Womble Carlyle Sandridge & Rice, PLLC. All Rights Reserved.

Calculation of California Paid Sick Leave May Spook Employers

As if paid sick leave wasn’t scary enough!  From accrual methods, to the protections provided to the time off, to the varying (and ever growing) laws in different jurisdictions, paid sick leave can be spooky.  What about how to calculate the rate of pay for the paid sick leave??  On October 11, 2016, the California Department of Industrial Relations, Division of Labor Standards Enforcement (“DLSE”) issued an opinion letter regarding its interpretation under California’s Healthy Workplace Health Families Act of 2014 (the “California Paid Sick Leave Law”) of the method of calculation of paid sick leave for employees paid by commissions and exempt employees who are given an annual, non-discretionary bonus.

California paid sick leave, State SealAs discussed in our July 13, 2015 article, the California legislature amended the California Paid Sick Leave Law to address, amongst other topics, the calculation of the rate of pay for sick leave.  In the Amendment, the legislature provided the following clarification regarding calculation of the rate of pay of sick time:

  • Non-exempt employees. The Amendment required an employer to calculate paid sick time for non-exempt employees using one of the following methods: (1) calculate the regular rate of pay for the workweek in which the employee uses paid sick time, whether or not the employee actually works overtime in that workweek; OR (2) divide the employee’s total wages, not including overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment.

  • Exempt employees. The Amendment required that paid sick time for “exempt employees” be calculated in the same manner as the employer calculates wages for other forms of paid leave time. This provision of the Amendment did not limit the categories of exempt employees which this calculation method applied to.

Now the DLSE has issued an opinion letter further interpreting these provisions.

How Should Employers Calculate Paid Sick Leave for Employees Only Receiving Commissions?

According to the DLSE’s opinion letter, employers must calculate paid sick leave payments for employees “who are almost entirely paid by commissions” as if they are non-exempt employees under the Amendment.  This opinion letter takes the position that only those employees exempt under one of the white collar exemptions (professional, executive, or administrative exemptions) may be paid their sick leave as an “exempt employee” under the Amendment.  The DLSE’s opinion letter maintains that employees classified as exempt under the outside or inside sales exemptions are not deemed to be “exempt” for purposes of the Amendment’s calculation of the rate of pay for sick leave.

How Should Employers Calculate Paid Sick Leave for Exempt Employees Who Receive an Annual Bonus?

The DLSE’s opinion letter then addressed how an employer calculates paid sick leave for an exempt employee under the white collar exemptions and who also receives a non-discretionary annual bonus at the end of each year.  The DLSE reasoned that a non-discretionary bonus does not figure into the salary of an exempt employee, and that under the Amendment, the employee would be paid an amount of pay equal to his or her regular salary for the sick day.

ARTICLE BY Susan E. Groff & Melissa L. Yen of Jackson Lewis P.C.

Jackson Lewis P.C. © 2016

Cook County, Illinois Increases Minimum Wage

cook county illinois minimum wageEffective July 1, 2017, employers in Cook County, Illinois, will be required to pay a higher minimum wage that will continue to increase every year thereafter. On October 26, 2016, the Cook County Board voted to gradually increase the minimum wage to $13 per hour by July of 2020. This is similar to the City of Chicago’s minimum wage increase, which gradually raises the minimum wage to $13 per hour by 2019. The new law applies to the all of Cook County, including unincorporated areas. However, home-rule towns can vote to opt out of the increase.

The minimum wage will first increase from $8.25 to $10 per hour on July 1, 2017. It will subsequently increase $1 per year until reaching $13 an hour in 2020. Future annual increases will be tied to the rate of inflation, not to exceed 2.5%. Tipped workers who make $4.95 under Illinois law will not see a wage increase until July 1, 2018, and these wage increases will be tied to the rate of inflation, not to exceed 2.5%.

Employers in Cook County should prepare for payroll increases beginning July 2017 and continuing every year thereafter.

ARTICLE BY Brian P. Paul & R. Whaley of Michael Best & Friedrich LLP
© MICHAEL BEST & FRIEDRICH LLP