Category: Labor & Employment

Covered Contractors Take Note of Changes in 2016

Pay transparency final rule is in effect

Executive Order 13665 (EO 13665), the Final Rule promoting pay transparency protection, took effect on January 11, 2016. The executive order covers employees and job applicants of companies with over $10,000 in federal contracts/subcontracts entered into or modified on or after January 11, 2016.

If covered by the law, employers must:

  • Disseminate the Pay Transparency Statement, as prescribed and made available by the OFCCP on its website, by either electronic posting OR by posting a copy of the provision in conspicuous places available to employees and applicants for employment; and

  • Incorporate the Pay Transparency Statement into existing employee manuals or handbooks; and

  • Update your equal employment opportunity clause in covered federal contracts/subcontracts and purchase orders to include a prohibition from discharging, or in any manner discriminating against any employee or applicant for employment because the employee or applicant inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant. If you are currently only incorporating the nondiscrimination obligation by reference to 41 CFR 60-1.4, you may continue to do so.

It is important to note that the pay transparency nondiscrimination provision is required to be posted in addition to the required “EEO is the Law” posting. Once the “EEO is the Law” poster is updated to reflect the new pay transparency nondiscrimination provision, it will be made available on the OFCCP’s and EEOC’s website. In the meantime, however, you can place the supplement to the “EEO is the Law” poster alongside the “EEO is the Law” poster. You can find the supplement on the OFCCP’s website.

Minimum wage increases for covered contractors

Effective as of January 1, 2016, the minimum wage for certain employees of covered federal contractors will increase by five cents to $10.15 per hour, and the minimum cash wage for tipped employees working on or in connection with covered federal contracts will increase to $5.85 per hour.

Covered contracts include those contracts resulting from solicitation issues on or after January 1, 2015, and contracts awarded outside of the solicitation process on or after January 1, 2015. Significantly, not all federal contractors are subject to this new requirement. As a practical matter, most “supply” contractors, or those providing goods (and not services) to the federal government should not be covered by this new Executive Order.

Article By Margaret R. Kurlinski & Deborah  Rehorst of Godfrey & Kahn S.C.

Copyright © 2015 Godfrey & Kahn S.C.

Over 4.5 Million Are Waiting for Green Cards—Over 100,000 of them are Employment-Based

The Department of State (DOS) recently published its annual report of immigrant visa applicants (2015 Annual Immigrant Visa Report), which tallies up the number of total applicants—including spouses and children—who are waiting for their respective priority date to become current, allowing for them to obtain their green card. The annual report, which totals the number of applicants up to Nov. 1, 2015, does not take into account those applicants who have adjustment of status applications pending with the U.S. Citizenship and Immigration Services (USCIS) as of Nov. 1.

Overall, 2015 saw a three precent increase of total applicants compared against last year, increasing from a total of 4,422,660 for 2014 to 4,556,021 for 2015. This total includes both family-based green cards and employment-based green cards. Employment-based green card applicants only accounted for roughly 100,000 of the 4.5 million. When compared against 2014, the percentage of employment-based applicants waiting to apply for their green cards increased from 90,910 to 100,747—an increase of 10.8 percent.

While a 10.8 percent increase seems like a marginal increase, examining specific categories individually reveals that certain categories—namely Employment First, Second, and Fifth—have grown in popularity with employers and investors. Employment First encompasses green card applications for aliens of extraordinary ability, outstanding researchers, and multi-national managers or executives. From 2014 to 2015, the Employment First category saw an increase of 27.1 percent on the waiting list, from 2,733 to 3,474. Employment Second is reserved for Aliens of Exceptional Ability, which is measured by positions that require a U.S. Master’s degree (or higher), or a Bachelor’s degree and five years of progressive experience.  In 2015, there was an increase of 36.5 percent for Employment Second, with 11,440 on the waiting list as opposed to 8,380 in 2014. Finally, Employment Fifth is reserved for investors and entrepreneurs who invest substantial capital into the U.S. economy, among other requirements. Employment Fifth saw the greatest increase from 2014 to 2015—175.2 percent. The specific wait list numbers, broken down by category, are below:

Employment-based Preferences for Visas​

Number of Applicants on Waiting List in Employment-based Preference Categories​

At first glance, the 140,000 of expected employment-based green card approvals this year seems like it would clear the existing backlog of green card applications of 100,747 left from 2015, but this is not the case because there is a seven percent per-country limit, which visa issuances to any single country, including China and India, cannot exceed. What this looks like for applicants from countries such as China and India is that the wait for green cards will only increase, absent legislative or executive action.

Reviewing the 2015 Annual Immigrant Visa Report by country reveals that India and China remain the world’s largest applicants across each Employment Category, a trend that will likely continue into 2016. For Employment First, China represents more than 25 percent of all applicants, with India coming in a distant second at 9.6 percent.

Employment First Preference Category by Country​

For Employment Second, India accounts for a two-thirds of all applicants at 66.8 percent; China, on the other hand, accounts for only 7.8 percent, falling just behind South Korea at 8.4 percent.

Employment Second Preference Category by Country​

For Employment Fifth, China leads the applicant-pool with 89.6 percent of all applications.  The next two countries—Hong Kong S.A.R., and Vietnam, only account for 1.4 percent each.

Employment Fifth Preference Category by Country​

For 2016, approximately 140,000 employment-based green cards are projected to be approved, meaning that the wait will continue for most of the 100,747 who are already waiting for their priority date to become current so that they can obtain their green cards. As the U.S. economy continues to rebound, it is safe to assume that only more applicants, especially from India and China, will continue to apply for employment-based green cards in the higher preference categories—Employment First, Second, and Fifth—where the wait is shorter as compared to Employment Third and Fourth, reserved for skilled workers, and special immigrants, respectively.

Article By Cole F. Heyer of Greenberg Traurig, LLP

©2015 Greenberg Traurig, LLP. All rights reserved.

Exercise Care When Terminating Employee Who Holds H-1B Status

If an employer doesn’t follow certain requirements when it terminates an employee holding an H-1B visa, then the employer could be surprised to learn that employee wasn’t properly terminated, and the obligation to pay that employee wages and benefits continues despite the attempted termination. As background, Department of Labor (DOL) regulations at 20 CFR §655.731 provide guidance regarding wage obligations relating to H-1B (“specialty occupation”) employees.  Employers are required to pay to H-1B visa holders the higher of the prevailing wage for the occupation, or the actual wage for the position, as confirmed in the Labor Condition Application (LCA) that the employer must file during the H-1B petition process.

This wage obligation even applies to H-1B nonimmigrants who have been “benched” or are no longer actively working for the employer.  When an employer terminates an H-1B employee prior to the expiration date of the employee’s H-1B status, DOL considers this action to be a form of benching the employee UNLESS/UNTIL the employer has taken the following steps to effectuate a “bona fide” termination:

STEP 1 – The employer must notify the USCIS that the relationship has been terminated (USCIS will then cancel the petition); and

STEP 2 – The employer must provide the employee with offer of payment for return transportation abroad [for these purposes, the term “abroad” is defined in 8 CFR 214.2(h)(4)(iii)(E) as the foreign national’s last place of foreign residence].

Although not required by regulation, it is also advisable for the employer to withdraw the underlying Labor Condition Application (LCA), as long as the terminated employee is the only employee who has been covered by that particular LCA.

Failure to take Steps 1 and 2 above may result in DOL’s requiring the employer to pay back wages commencing on the date of attempted dismissal and continuing until the date upon which DOL determines that the termination has been perfected.

Note that these regulations do not apply to an H-1B employee who has voluntarily terminated his/her employment prior to the H-1B expiration date. Termination by the employer launches these stringent requirements.  In reality, many terminated H-1B employees are able fairly quickly to secure new employment and to transfer their H-1B sponsorship to the new employer; however, these two simple steps should shield the original H-1B sponsor from potential back-pay obligations.Article By

ARTICLE by Nancy M. Lawrence of Odin, Feldman & Pittleman, P.C.
© 2015 Odin, Feldman & Pittleman, P.C.

2016 H-1B Filing Season Is Here

Now is the time for employers to assess their FY2017 H-1B needs and to start preparing their petitions for submission on April 1.

On April 1, 2016, US Citizenship and Immigration Services (USCIS) will begin accepting cap-subject H-1B petitions for fiscal year 2017 with an employment start date of October 1, 2016. We recommend that employers send all H-1B petitions subject to the FY2017 cap to USCIS on March 31 so that USCIS receives them on April 1. USCIS will reject any cap-subject H-1B petition that it receives before April 1.

USCIS has a quota of 65,000 cap-subject H-1B visas each fiscal year. A separate allotment of 20,000 H-1B visas is available to foreign nationals who hold a master’s degree or other advanced degree from a US institution of higher education. As indicated in the table below, demand for H-1B visas has fluctuated in past years. A few years ago, it took months to reach the cap; recently, in 2014 and 2015, the cap was reached within the first few days of filing. Although it is not possible to predict with complete accuracy what the demand for H-1B visas will be this year, an improving economy and an increasing demand for qualified workers, especially in the information technology industry, strongly suggest that demand will be high and that the cap will be reached again very early this year, possibly within a week of April 1. Employers should therefore submit their cap-subject H-1B petitions as early as possible.

Year    

Date H-1B Cap Reached

2009 (FY2010)

December 21, 2009

2010 (FY2011)

January 26, 2011

2011 (FY2012)

November 22, 2011

2012 (FY2013)

June 11, 2012

2013 (FY2014)

April 5, 2013

2014 (FY2015)

April 7, 2014

2015 (FY2016)

April 7, 2015

By law, 6,800 of the 65,000 H-1B visas are allocated as H-1B1 visas to nationals of Chile and Singapore.

Only petitions filed on behalf of foreign nationals who have not previously been counted against the H-1B cap in the last six years are subject to this year’s H-1B cap. Accordingly, most H-1B change of employer petitions are not subject to the cap. H-1B petitions for foreign nationals employed by institutions of higher education, nonprofit research organizations, or for employment at governmental research organizations are not subject to the cap.

How This Affects You

Employers should review the immigration status of their current and potential foreign national employees and identify any individuals for whom H-1B status would be beneficial. These individuals include the following:

  • Recent graduates employed in F-1 status and candidates abroad who are subject to the annual H-1B cap

  • Candidates in some other nonimmigrant status (e.g., L-1B) who are approaching the maximum limits of their status and would benefit from a change of status to H-1B

  • Candidates in another nonimmigrant status who work for a different employer and would require an H-1B visa to change jobs

  • Candidates in TN, E, or H-1B1 status for whom an employer is considering pursuing permanent residence

Note that if the limit on H-1B visa numbers is reached on any one of the first five business days of the cap season, all petitions that USCIS receives between Friday, April 1 and close of business on Thursday, April 7 will still be accepted, but their selection for adjudication will be subject to USCIS conducting a lottery among them. USCIS has held a lottery for the last three years, and it is likely that it will do so again this year.

Article By Eleanor Pelta, Eric S. Bord, A. James Vázquez-Azpiri, Roland C. Lechner, Lisa Stephanian Burton & Tracy Evlogidis of Morgan, Lewis & Bockius LLP
Copyright © 2015 by Morgan, Lewis & Bockius LLP. All Rights Reserved.

Happy New Year: Looking Back and Looking Ahead at EEOC’s Strategic Plan

EEOCSealIn December 2012, the EEOC adopted its Strategic Enforcement Plan for Fiscal Years 2013-2016 (the “SEP”), in which it highlighted the agency’s enforcement priorities for the coming three years.  Now two years into the plan, the EEOC continues to refine its strategic enforcement efforts and employers are responding to them.

The EEOC’s SEP identified six priorities:

  1. Eliminating Barriers in Recruitment and Hiring.

  2. Protecting Immigrant, Migrant and Other Vulnerable Workers.

  3. Addressing Emerging and Developing Issues.

  4. Enforcing Equal Pay Laws.

  5. Preserving Access to the Legal System.

  6. Preventing Harassment Through Systemic Enforcement and Targeted Outreach.

In 2015, the EEOC continued its effort to pursue these stated priorities through systemic investigations and litigation arising from those investigations, despite a mixed record of success in the courts.  For example:

  • Background Check Litigation: Despite some notable setbacks, such as the Fourth Circuit’s affirmance of summary judgment against the EEOC and scathing rebuke of its litigation conduct in EEOC v. Freeman, the EEOC has continued to pursue cases involving background checks in furtherance of its stated priority of eliminating barriers in hiring.

  • Pregnancy and Disability Discrimination: Following the United States Supreme Court’s decision in Young v. UPS, the EEOC reissued its pregnancy discrimination guidance, noting that the “Court explained that employer policies that are not intended to discriminate on the basis of pregnancy may still violate the Pregnancy Discrimination Act if the policy imposes significant burdens on pregnant employees without a sufficiently strong justification.”  The EEOC also noted that the ADAAA does not require an impairment to “last a particular length of time to be considered substantially limiting,” thereby potentially including pregnancy.  The EEOC filed numerous ADA lawsuits in 2015, particularly focusing on reasonable accommodation issues.

  • Equal Pay: Although the EEOC continues to assert its pronounced attention to alleged violations of the Equal Pay Act, it has not expended litigation resources commensurate with its statements.  The EEOC may well monitor developments in equal pay protection under state law (e.g., California’s Equal Pay Act, effective January 1, 2016) to assess the value of its own litigation efforts.

  • Sexual Orientation or Gender Identity Discrimination: In an effort to address “emerging and developing issues,” the EEOC continues to include sexual orientation or gender identity discrimination in its definition of discrimination based on sex.  In its August 2015 fact sheet, the EEOC identified numerous private sector lawsuits initiated by the EEOC or in which the EEOC filed amicus briefs, addressing LGBT-discrimination-related issues.

The EEOC appears poised in 2016 to continue pursuing the SEP aggressively through the use of systemic investigations.  Employers can expect the EEOC to seek to expand investigations of individual charges, particularly in substantive areas aligning with the SEP.  Although the United States Supreme Court ruled in Mach Mining, LLC v. EEOC (2015) that the EEOC’s pre-suit obligation to attempt to conciliate alleged unlawful workplace practices is subject to judicial review, the EEOC will continue to test the limits of judicial review of EEOC’s investigations and attempts to conciliate.  As the new year begins, employers must remain vigilant when challenging failures by the EEOC to conciliate or properly investigate charges and pay particular attention to charges alleging disability, pregnancy and sexual orientation or gender identity discrimination.

Article By James J. Swartz, Jr. of Polsinelli PC

© Polsinelli PC, Polsinelli LLP in California

New Year, New Wages : Minimum Wage Rates Around the States

After ringing in 2016, employers may want to skip the eggnog and check their wages to make sure they are properly paying their employees.  On Jan. 1, the minimum wage rates in 14 states went up and all are higher than the federal minimum wage.  These states and rate increases include:

Alaska

$9.75 per hour

Arkansas

$8.00 per hour

California

$10.00 per hour

Connecticut

$9.60 per hour

Hawaii

$8.50 per hour

Massachusetts

$10.00 per hour

Michigan

$8.50 per hour

Nebraska

$9.00 per hour

New York

$9.00 per hour

Rhode Island

$9.60 per hour

Vermont

$9.60 per hour

West Virginia

$8.75 per hour

The minimum wage rates in both Colorado and South Dakota will increase due to a cost of living adjustment tied to inflation.  For 2016, Colorado’s minimum wage is $8.31 per hour and South Dakota’s minimum wage now is $8.55 per hour.

Other notable minimum wage increases that will occur throughout 2016 include:

District of Columbia

$11.50 per hour, effective July 1, 2016

Maryland

$8.75 per hour, effective July 1, 2016

Minnesota

$9.50 per hour for large employers, effective August 1, 2016

$7.75 per hour for small employers, effective August 1, 2016

Finally, for employers who have federal service contracts, the minimum wage for employees has increased to $10.15 per hour.  These employers should pay close attention to the hourly rates in effect for the applicable contract as some rates will be higher than the minimum wage rate.

Article By Tina A. Syring of Barnes & Thornburg LLP

© 2015 BARNES & THORNBURG LLP

Extension of 2015 Affordable Care Act Reporting Deadlines

On December 28, 2015, the Internal Revenue Service issued Notice 2016-4 extending the deadline for information reporting requirements under the Patient Protection and Affordable Care Act (the “ACA”). The reporting requirements are intended to assist the IRS in application of ACA penalties and were two-fold: an initial disclosure to the employee and a final report to the IRS. These requirements were to be satisfied by the filing of Form 1095 (with different filings under Form 1095-B or 1095-C dependent on the type of insurance arrangement sponsored by the employer). The deadline for furnishing the form to the employee had been set for February 1, 2016. The deadline for filing Form 1095 with the IRS was to be February 29 for non-electronic filers and March 31 for all employers who are “electronic filers” (filing greater than 250 single 1095 forms).

Notice 2016-4 has now extended those deadlines as follows:

New deadline for furnishing Form 1095 to employees: March 31, 2016.

New deadline for filing Form 1095 with the Service:

Non-electronic filers: May 31, 2016.

Electronic filers: June 30, 2016.

Article By Nicole M. Hanna of Dinsmore & Shohl LLP

© 2015 Dinsmore & Shohl LLP. All rights reserved.

Four New Year’s Resolutions to Avoid the Damaging Loss of Trade Secrets

On December 21, 2015, an Illinois jury awarded Miller UK Ltd. $73.6 million against Caterpillar Inc.  Miller supplied couplers for Caterpillar’s equipment, and the jury concluded that Caterpillar used its leverage as Miller’s largest customer to demand access to information that Caterpillar then used to manufacturer its own version of the coupler.  As a result of the alleged theft, Miller claimed it had to terminate roughly seventy-five percent of its workforce, close an office, and scale back a new business venture.  This lawsuit was not between an employer and an employee, but it holds important lessons for employers that operate in industries and environments with valuable trade secrets.

1.   Audit Non-Disclosure Agreements

Trade secrets laws across the country provide a layer of protection for misappropriated trade secrets.  Non-disclosure and confidentiality agreements can often provide additional protection, by catching disclosures that would not be covered by trade secrets laws.

In the New Year, audit company records to confirm that any company or person who has access to the company’s trade secrets and proprietary information has signed a non-disclosure or confidentiality agreement.  If any of these parties did not sign an agreement during the contracting process, get an agreement in place immediately.

2.  Review Materials

In the New Year, review the company’s handbooks, policies, offer letters, and employment agreements to ensure that they prohibit theft and misappropriation of trade secrets and proprietary information from third parties (and not just the company).

Not only will this hopefully prevent employees from engaging in misconduct for which the company could be held liable (i.e. engaging in misappropriation), it could help the company avoid being held liable for any misconduct that does occur.

3.  Audit Restrictive Covenants

To the extent that your company has trade secrets and proprietary information that can be protected through restrictive covenants under applicable law, in the New Year, audit the company’s agreements with employees to ensure that all employees who have access to that information have signed the required restrictive covenants.  If an employee has not signed an agreement, identify what legal consideration will be required to obtain enforceable restrictive covenants. For those employees who have signed restrictive covenants, confirm that the company has signed (if required) and that the company records consist of both the employee’s signature and the body of the agreement that the employee signed.  Finally, review the company’s form restrictive covenants to ensure that they have kept up with the growth and development of the company (i.e. that they protect all of the company’s trade secrets and proprietary information) and with the latest developments in the law.

4.  Resolve

In the New Year, resolve to follow the three steps above at least once per year.  As the verdict demonstrates, an ounce of prevention is worth a pound of cure.  Following a regular maintenance schedule is the best way for a company to minimize the risks associated with trade secrets and proprietary information.

Article By Gillian McKean Bidgood of Polsinelli PC

© Polsinelli PC, Polsinelli LLP in California

Hillshire Brands Company Pays $4 Million to Settle Race Discrimination Suit

EEOCSealAfrican American Bakery Workers Subjected to Racist Comments and Graffiti in the Worksite, Federal Agency Charged

DALLAS – Hillshire Brands Company (formerly known as the Sara Lee Corporation) will pay $4 million to a group of 74 African-American former employees and provide other significant relief to settle a lawsuit where they were subjected to a racially hostile work environment at a former Sara Lee facility in Paris, Texas, the agency announced today.

EEOC claimed African-American employees were subjected to racist graffiti on the walls of the bathrooms and locker room. The former bakery employees also alleged that during work hours, they were berated with racial slurs by supervisors and other white co-workers, and complaints by the plant workers went unaddressed by management.

Race discrimination in the workplace, including race harassment, violates Title VII of the Civil Rights Act of 1964.  The EEOC filed suit (Case No. 2:15-cv-1347) in U.S. District Court for the Eastern District of Texas, Marshall Division, after first attempting to reach a pre-litigation settlement through its conciliation process.

“The Commission completed an extensive investigation at the Sara Lee plant, which included conducting interviews with the former bakery workers,” said Meaghan L. Shepard, trial attorney for the Dallas District of EEOC. “EEOC determined racial slurs and graffiti continued at the facility in Paris for years, until the doors finally closed in November 2011.”

“EEOC strongly believes it is critically important for companies to set policies and provide effective avenues for complaints to address racial harassment in the workplace,” said EEOC Supervisory Trial Attorney Suzanne Anderson. “African-American workers on the Sara Lee bakery production lines in Paris felt embarrassed and intimidated by the graffiti in the bathroom and the racial slurs on the production floor. Strong corporate policies and quick remedial action protects against this type of workplace discrimination.”

The two-year consent decree settling the case provides for an injunction where Hillshire Brands will implement various preventative approaches regarding discrimination or harassment against any employee on the basis of race and will periodically report incidents or investigations to EEOC. Hillshire Brands also agreed to engage in remedial measures such as anti-discrimination training and implementation of procedures to prevent and promptly address graffiti issues.

Belinda McCallister, acting director of EEOC’s Dallas District Office, said, “We are pleased with the approach taken by the employer to acknowledge the hostile environment that once existed and for taking positive steps toward ensuring a healthy workplace in the future.”

EEOC enforces federal laws prohibiting employment discrimination. Further information about EEOC is available on its web site at www.eeoc.gov.

See original news release here: http://www1.eeoc.gov/eeoc/newsroom/release/12-22-15.cfm

© Copyright U.S. Equal Employment Opportunity Commission

EEOC Sues McDonald's for Disability Discrimination

mcdonalds logoFast Food Giant Denied Sign Language Interpreter for Deaf Applicant

KANSAS CITY, Mo. — McDonald’s Corporation and McDonald’s Restaurants of Missouri violated federal law by refusing to accommodate and hire a deaf applicant, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit filed today.

According to the suit, Ricky Washington, who is deaf, applied online for a job at a McDonald’s restaurant in Belton, Mo. in June 2012. Washington indicated on his application that he attended Kansas School for the Deaf. Washington also said he had previous job experience working as a cook and clean-up team member at a McDonald’s restaurant in Louisiana in 2009. When the Belton restaurant manager learned Washington needed a sign language interpreter for his job interview, she canceled the interview and never rescheduled it, despite Washington’s sister volunteering to act as the interpreter. Restaurant management continued to interview and hire new workers after Washington made several attempts to schedule an interview.

Such alleged conduct violates the Americans with Disabilities Act of 1990 (ADA), which prohibits discrimination against people with disabilities in employment and requires employers to make reasonable accommodations for job applicants so they will have equal opportunities during the application process. EEOC filed its lawsuit (EEOC v. McDonald’s Corporation, et al, 4:15-cv-01004-FJG) in U.S. District Court for the Western District of Missouri after first attempting to reach a pre-litigation settlement through its conciliation process. EEOC seeks back pay, compensatory and punitive damages, and injunctive relief, including training for all McDonald’s managers on accommodations for applicants with disabilities, particularly those who are deaf.

EEOC St. Louis District Director James R. Neely, Jr. said, “Removing obstacles in the hiring process for people with disabilities is a national priority for EEOC. All employers, but especially large ones, should join with the agency to make sure everyone has equal access to the employment process.”

“People with disabilities have one of the highest unemployment rates in the country,” added EEOC Regional Attorney Andrea G. Baran. “Providing equal employment opportunities to all job applicants – including those with disabilities – is not just the law, it is good for our economy and our workplaces.”

According to company information, McDonald’s is a global fast food provider that serves over sixty-nine million customers per day in 100 different countries.  The Belton, Mo. restaurant is owned and operated by the corporation’s world-wide headquarters in Oak Brook, Illinois.

Eliminating barriers in recruitment and hiring is one of six national priorities identified by EEOC’s Strategic Enforcement Plan (SEP).

The St. Louis District Office oversees Missouri, Kansas, Nebraska, Oklahoma and a portion of southern Illinois.

EEOC is responsible for enforcing federal laws prohibiting employment discrimination.

The original content can be viewed here.

© Copyright U.S. Equal Employment Opportunity Commission