A wave of labor strikes in October of 2021 led experts to dub the month “Striketober.” And this year, we saw the trend continue as companies across the nation faced a number of work stoppages through late-September and October. As the second Striketober comes to an end, we look at the general trends in labor organizing and what employers should expect in the months ahead.

First, the Supreme Court is poised to take action. The Court recently agreed to consider a case at the heart of the right to strike: Can employers sue unions in state court when strikes cause economic harm, such as destruction of property?

The case arises from a dispute between a cement company and its truck drivers in Washington state. Contract negotiations between the local Teamsters union and employer, Glacier Northwest, had broken down. In August of 2017, union leaders instructed drivers to bring their trucks back to the yard and strike. According to the company, the union intentionally timed this so that the concrete in the trucks had already been mixed, which could solidify in the drums and destroy them. The union countered that the trucks were left running so the concrete wouldn’t harden. Glacier Northwest sued the union to recover damages.

This will be the Court’s first major labor decision since 2018. If the judges side with the Glacier Northwest, it will likely open the door to more litigation between unions and employers when labor action causes economic harm to an employer. Be sure to look out for an alert when this case is decided. Continue Reading The Supreme Court and Lessons from “Striketober”: What Should Employers Expect?

The Illinois Biometric Information Privacy Act (BIPA) has been on the books as one of the nation’s most protective biometric privacy statutes since 2008. It was also one of the first to give individuals a cause of action for monetary damages against individuals or companies that violate the law. For the first time in the Act’s 14 year history, however, a case has been tried before a jury to a verdict. The Rogers v. BNSF trial recently wrapped up in the U.S. District Court for the Northern District of Illinois, with Judge Matthew Kennelly presiding and the $228 million verdict stunning, but not surprising, many who have been following BIPA developments.

Despite BIPA’s relatively maturity, basic questions still remain as to the scope of the statute. Most pressingly, the applicable statute of limitations for violations of the Act (how many years a plaintiff has to file a lawsuit after a violation), and the number of BIPA violations that may accrue have not been decided. Continue Reading BIPA Goes on Trial

The NYC Pay Transparency Law will go into effect this week. Starting November 1, 2022, employers with four or more employees advertising jobs in NYC must include the minimum and maximum salary that the employer believes in good faith at the time of the posting they are willing to pay for the advertised job, promotion, or transfer opportunity.

Employers can access the City’s most recent and complete guidance here, but below are a few highlights:

  • Employers should comply with the new requirements when advertising for positions that can or will be performed, in whole or in part, in NYC, whether from an office, in the field, or remotely from the employee’s home.
  • “Good faith” means the salary range the employer honestly believes at the time they are listing the job advertisement that they are willing to pay the successful applicant(s).
  • Salary includes the base annual or hourly wage or rate of pay, regardless of the frequency of payment, and does not include other forms of compensation or benefits (e.g., health insurance, severance pay, or 401(k)).
  • An “advertisement” is a written description of an available job, promotion, or transfer opportunity, regardless of the medium by which the description is disseminated (e.g., internal bulletin boards, internet ads, printed flyers).

Continue Reading Compliance Reminder – NYC Pay Transparency Law Takes Effect November 1, 2022

The Great Resignation of 2021 and 2022  has spawned what we are calling “The Great Rehire.” To sort through the deluge of new applicants, many employers have become more reliant on technology such as artificial intelligence and automated employment decision tools (AEDT).

If you are using AI and/or AEDT, beware. Starting January 1, 2023, New York City employers will be subject to one of the most sweeping regulations governing AEDT to date.

Local Law 144 prohibits employers from using AEDT in hiring or promotion decisions unless they have taken several affirmative steps, including conducting a bias audit. This may include tools like resume-scanning software and more advanced “chatbots” and “job-fit” algorithms. Continue Reading An Employer’s Guide to NYC’s New AI Law – Are You in Compliance?

Tuesday, November 8, 2022 at 12:30pm ET

HR employees are, willingly or not, the guardians of the company’s most sensitive collection of data—its employee’s personal information. Cybercriminals often perceive the human resources department as the perfect gateway into a company’s employee data goldmine. Many scams and information theft are perpetrated through social engineering. Cybercriminals posing as job applicants, recruiters or new vendors pray on the fact that human resource employees often receive emails and attachments from unknown sources. Conversely, because of the central role that HR plays in employees’ lives, many employees reflexively open emails and attachments that appear to be sent from the HR department. Employees are just one click away from granting fraudsters the access they need to install ransomware or steal login credentials, potentially exposing employees’ sensitive and valuable personal information, and resulting in significant losses and legal exposure for your company.

This webinar will cover:

  • Weapons and techniques fraudsters use to infiltrate company systems and current scam trends
  • Proactive best practices for fraud and information theft prevention
  • E! true HR stories: theft, lawsuits, and the one simple move that would have stopped it all
  • What to do when the perpetrators are in-house

To RSVP for this webinar, please click here.

 

With the recent expansion of pay transparency laws in Colorado, New York City, and Washington, it should come as no surprise to employers that California has also opted to expand its existing pay transparency laws.

On September 27, 2022, California Governor Gavin Newsom signed SB 1162, which broadens the state’s pay transparency laws by requiring employers to provide pay scale information and expanding pay data reporting obligations for certain employers.

The earliest of the law’s changes go into effect on January 1, 2023, but employers should now begin the process of updating their existing organizational policies and procedures to ensure timely compliance with the new regulation when it takes effect.  Here’s a brief overview of existing law and the new requirements set forth in SB 1162.

Pay Transparency

Prior to the enactment of SB 1162, under the current law, employers are required to provide an applicant for employment with the pay scale information for the position the applicant is seeking, upon reasonable request.  Current law does not require employers to provide existing employees pay scale information for their current positions.  SB 1162 now affords California employees the right to request pay scale information and adds the additional mandate that employers must include pay scale information in job postings.  The term “pay scale” is defined as “the salary or hourly wage range that the employer reasonably expects to pay for the position.”  Effective January 1, 2023, California employers must comply with the following requirements:

  • Employers must provide their employees with pay scale information for their current positions, when the information is requested.
  • Employers with 15 or more employees must include in any job posting the pay scale information for the position sought to be filled; and
  • Employers must maintain records of a job title and wage rate history for each employee for the duration of his or her employment, plus 3 years after the end of the employment in order for the Labor Commissioner to determine if there is a pattern of wage discrepancy.

Continue Reading Pay Transparency Expansion in California

On November 24, 2022, New York will open a one-year “lookback” window that will revive older sexual abuse claims that were previously barred by applicable statues of limitations and allow victims to file suit against responsible parties regardless of when the abuse occurred.  The lookback window is the result of the recently-enacted Adult Survivors Act (“ASA”). The ASA is an analogue to New York’s Child Victims Act (“CVA”) of 2019. The CVA revived the claims of victims who were under eighteen at the time of abuse. In contrast, the ASA applies to victims who were eighteen or older when the abuse occurred.

Like the CVA, the ASA revives otherwise time-barred claims based on both intentional and negligence theories of relief.  This means that companies that formerly employed abusers may be sued and held liable under vicarious liability theories – such as negligent hiring, training and retention – even where the employer had no direct knowledge or involvement in the abuse. Continue Reading New York Employers Must Take Action to Secure Insurance Coverage for the Coming Wave of Sexual Abuse Claims Under the Adult Survivors Act

Employers can be forgiven for diverting their attention during the past three years to pressing pandemic-related employment issues—vaccine mandates, return-to-work challenges, managing hybrid workforces, with all the novel and thorny legal issues that emerged from a transformed workplace. But in an ever-changing employment law landscape, a new compliance challenge has emerged: federal, state, and local regulations governing the use of artificial intelligence (“AI”) in the hiring process. These new laws and regulations are a perfect storm for liability. They are new and unfamiliar, and they are easy to violate despite employers’ best intentions.

The rise of single-click job application programs like “Easy Apply” on LinkedIn or “1 Click Apply” on ZipRecruiter has made it extraordinarily easy for applicants to submit job applications. But as any recruiting manager knows, the task of filtering resumes and job applications for hundreds of applicants per position ranges from difficult to almost impossible. So how does a hiring manager make a “rough cut” from the piles of electronically-submitted resumes and job applications?  Happily, AI offers a powerful tool for making that rough cut; unhappily, AI can result in employment decisions, literally without human intervention, that may violate anti-discrimination laws—or at least, that’s the regulatory concern, as an increasing number of jurisdictions have articulated it.

The idea of using AI in making hiring decisions is simple: machine-based algorithms can identify certain objectively desirable characteristics or experience in candidates, and in theory, those algorithms (precisely because they are supposedly objective) actually reduce the opportunity for human bias. The principal concern of regulators is that, at least so far, AI technology is a black box. To date, there has been little to no meaningful transparency in exactly what the technology is considering and evaluating in that algorithmic process of making the rough cut. The plethora of new regulation is aimed at exactly this perceived lack of transparency. Continue Reading The New Regulatory Frontier: Using AI Tools is About to Become More Difficult

On September 7, 2022, the NLRB issued a notice of proposed rulemaking seeking to replace the Trump-era final joint employer rule, which provided that an employer would be considered a joint employer under the NLRA only where it exercised “substantial direct and immediate control” over the essential terms and conditions of another company’s employee.

The NLRB’s newly proposed rule drastically expands the joint employer standard to encompass relationships where a company holds indirect and unexercised control over the terms and conditions of another company’s employee.

Employers would be wise to begin thinking now how this will impact their business.

Background

The NLRA does not expressly address situations where employees are employed jointly by two or more companies  As a result, the NLRB and courts have typically applied common-law agency principles to determine when one or more entities jointly employ a particular group of employees.

In an Obama-era decision, Browning-Ferris Industries of California, Inc., d/b/a BFI Newby Island Recyclery, 362 NLRB 1599 (2015), the NLRB held that the “right to control, in the common-law sense, is probative of joint-employer status, as is the actual exercise of control, whether direct or indirect.” Id. at 1614. Essentially, the BFI majority found that a company could be deemed a joint employer even where its control over the essential working conditions of another company’s employees was indirect, or in circumstances where it was contractually reserved, but not exercised. Id. at 1613-14.

In February 2020, in an effort to roll back BFI, the Trump-era Board published a final rule that narrowed the joint-employer test to include only those situations where the two employers “share or codetermine” the essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction. The employer-friendly final rule defined “share or codetermine” as the possession and exercise of “such substantial direct and immediate control over one or more essential terms or conditions of their employment as would warrant finding that the entity meaningfully affects matters relating to the employment relationship with those employees.”

The final rule also considered indirect control over essential terms or conditions of employment, contractually reserved control over essential terms or conditions of employment, and control over mandatory subjects of bargaining other than essential terms and conditions of employment into the joint-employer analysis, “but only to the extent [they] supplement[] and reinforce[] evidence of the entity’s possession or exercise of direct and immediate control over a particular essential term and condition of employment.”

The final rule went into effect on April 27, 2020.

The Proposed Joint-Employer Standard (Revisited)

The NLRB’s new proposed rule rejects the 2020 rule’s narrow focus on “direct and immediate control” and returns to the rationale in the BFI decision, stating that “a party asserting a joint-employment relationship may establish joint-employer status with evidence of indirect and reserved forms of control, so long as those forms of control bear on employees’ essential terms and conditions of employment.”

The proposed rule would also expand the definition of “essential terms and conditions of employment,” to include “work rules and directions governing the manner, means, or methods of work performance.”

The proposed rule reflects the Board’s view that the NLRA’s purpose of promoting collective bargaining and stabilizing labor relations “are best served when two or more statutory employers that each possess some authority to control or exercise the power to control employees’ essential terms and conditions of employment are parties to bargaining over those employees’ working conditions.”

Members of the public may file comments on the Board’s proposal on or before November 7, 2022 and replies to comments filed during the initial comment period must be filed on or before November 21, 2022.

Thinking Ahead…

Employers should begin to consider how the new joint employer standard will impact their existing business structure. Under the proposed rule, a company would be considered a joint employer if they co-determine not just scheduling, wages, and benefits, but also THE direction of the manner and means of performance, even where they do not retain any direct and immediate control over those terms and conditions.

This means that companies that currently outsource staffing, employee management, and/or human resources may no longer use those attenuated relationships to act as a shield for compliance with the NLRA, including potential bargaining obligations.

Thinking ahead, employers should begin look at their staffing and other third party agreements to determine whether they contain reserved control provisions. Even if never exercised, under the propose rule, such provisions are likely probative of joint-employer status. Companies should also consider whether it is now necessary to retrain managers who oversee employees of another entity, such as a staffing agency.

Back in July 2021, President Biden signed Executive Order 14036 directing the Federal Trade Commission (“FTC”) to “address agreements that may unduly limit workers’ ability to change jobs.” As a result, gallons of ink were spilled by practitioners across the country predicting the downfall of non-compete provisions nationwide, replacing the current patchwork of state laws with something more akin to California.

While these predictions have not yet come to fruition, the FTC recently expanded its non-compete enforcement into an area that caught many by surprise – non-compete provisions executed in conjunction with a business sale. Most who follow this area of the law can be forgiven for not seeing this issue on the horizon, as the fanfare regarding President Biden’s EO mainly focused on non-competes in the employer-employee context. In fact, employer-employee provisions have been an enforcement strategy of state legislatures and attorneys general for the past several years. Few, if any, discussed these agreements as part of business deals.

This is because non-compete provisions in connection with a business sale have traditionally been viewed as a business necessity and not a mechanism that impedes on worker mobility. This concept is so commonly accepted that even California, the state that literally outlawed non-compete agreements, carved out a limited exemption for the “sale of goodwill of business or ownership interest.”  See Cal. Bus. & Prof. Code §16601. Continue Reading Dire Straits? The FTC’s Expanding Non-Compete Enforcement Seeks to Narrow Sale-of-Business Agreements