NLRB Blocks Broad Severance Provisions

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February 21, 2023

  

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  • Severance agreements must be narrowly tailored not to interfere with employee NLRA rights.
  • Merely offering a severance agreement with unauthorized language is itself a violation under the NLRA.

Discussion

In McLaren Macomb, the National Labor Relations Board (NLRB) reversed previous 2020 NLRB decisions in Baylor University Medical Center and IGT d/b/a International Game Technology, returning to longstanding precedent stating that employers may not offer employees severance agreements that require employees to broadly waive their rights under the National Labor Relations Act (NLRA).

The case involved severance agreements offered to furloughed employees that prohibited them from making statements that could disparage the employer and from disclosing the terms of the agreement itself. The NLRB said that these terms were overly broad because they improperly required the employees to waive their Section 7 rights under the NLRA. Going further, the NLRB stated that the severance agreement offer was itself an attempt to deter employees from exercising their statutory rights.

How does this ruling impact employers? Employers may still be able to include narrowly tailored language regarding nondisparagement if the agreement includes a disclaimer against violating Section 7 rights. However, the ability to maintain confidentiality over a severance agreement may be more difficult. The ruling specifically addressed being able to discuss the terms of the severance with other employees, the union, and the NLRB. It does not specifically state that all confidentiality is prohibited, but only to the extent it would interfere with Section 7 rights. Even with a carve out for NLRB rights, confidentiality may be hard to contain for covered workers. Keep in mind that Section 7 rights do not apply to all employees. For example, managers, most supervisors, public sector employees, and some agricultural workers are not covered by NLRA protections.

Also note that this ruling is expected to be followed up with clarifying advisory memos from the NLRB. At the very least, severance agreements will need to be carefully tailored and include disclaimer language for protection of Section 7 rights.

 

Action Items

  1. Review the NLRB decision here.
  2. Have severance agreements reviewed by legal counsel.
  3. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

Day Rate Pay Does Not Meet Salary Basis Test for Overtime Exemptions

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All FLSA-Covered Employers

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February 22, 2023

  

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  • Employees paid solely a day rate are not overtime exempt under the FLSA.
  • Employers can bring day rate pay arrangements into compliance by following two methods provided by the U.S. Supreme Court.

Discussion

The U.S. Supreme Court recently said payment of a “day rate” does not satisfy the salary basis test for the white-collar exemption for overtime under the Fair Labor Standards Act (FLSA). In Helix Energy Solutions Group, Inc. v. Hewitt, the employee was a tool-pusher on an offshore oil rig. Regardless of how many hours he worked during the day, he was paid between $936 and $1,341 per day resulting in an annual salary of over $200,000. Despite receiving more than the $455 per week previously required for an overtime exemption under the FLSA salary basis test, the employee claimed he was misclassified as exempt and was entitled to overtime. The Court agreed.

The Court reasoned that day rate employees are not paid on a salary basis because the amount of pay fluctuates based on the number of days worked in a week. In addition, the FLSA’s description of a salary did not apply to a day rate because date rate pay is provided for each day worked. The Court provided two methods in which day rate pay arrangements could be brought into compliance with the FLSA salary basis test. Under the first method, employers could add a weekly guaranteed payment regardless of the time worked per week that meets the minimum weekly required amount under the salary basis test and has a reasonable relationship between the guaranteed amount and the actual amount earned. Under the second method, employers can convert the day rate to a weekly salary for time spent working. Employers who have day rate employees should review the arrangement and make sure it is compliant with the methods offered by the Court.

 

Action Items

  1. Review day rate pay arrangements with legal counsel for compliance with salary basis test described by the Court.
  2. Have appropriate personnel trained on overtime exempt classifications.
  3. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

Updated FLSA and FMLA Guidance for Remote Employees

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February 9, 2023

  

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  • Remote workers receive the same meal, rest, and lactation period protections as other employees.
  • Remote workers meet the 75-mile radius eligibility requirement under FMLA if they report to an office or receive assignments from a worksite with at least 50 employees in a 75-mile radius.

Discussion

The Wage and Hour Division of the U.S. Department of Labor issued a Field Assistance Bulletin providing guidance on protections for remote workers under the Fair Labor Standards Act (FLSA) and Family and Medical Leave Act (FMLA). The following are key points made to emphasize that remote employees receive the same benefits as in-person workers.

Break Periods. When employees take short breaks of 20 minutes or less, the employer must treat such breaks as compensable hours worked regardless of whether the employee works from home, the employer’s worksite, or some other location that is not controlled by the employer.

Meal Periods. Regardless of work location, bona fide meal periods, where employees are completely relieved from duty and are able to effectively use the time for their own purposes, are not hours worked under the FLSA.  Meal periods interrupted by work activities mean that the employee was not relieved of all duties and the meal period must be compensated.

Lactation Periods. FLSA-required lactations periods apply even when an employee works remotely. An employer must provide an appropriate place for an employee to pump breast milk when the employee is working at an off-site location. This includes ensuring that an employee cannot be viewed by any employer-provided or required video system (e.g., a computer camera, security camera, or web conferencing platform) during lactation periods.

FMLA Eligibility. Remote employees are eligible for FMLA leave on the same basis as any other employee. Employers must keep accurate records of hours worked to determine FMLA eligibility, otherwise it is the employer’s burden to show that the employee has not worked the required 1250 hours in the last 12 months.

FMLA 75-Mile Radius. To be eligible for FMLA leave, employees must work at a location that has 50 employees within a 75-mile radius. A remote employee’s personal residence is not a worksite. The worksite is the office to which they report or from which their assignments are made. The count of employees within 75 miles of a worksite includes all employees whose worksite is within that area, including employees who telework and report to or receive assignments from that worksite.

 

Action Items

  1. Review the Bulletin here.
  2. Review meal, rest, and lactation period practices to ensure consistent enforcement.
  3. Have appropriate personnel trained on FMLA eligibility for remote workers.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

FMLA Intermittent Leave Used to Reduce Workday

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All Employers Subject to the FMLA

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February 9, 2023

  

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  • Employees may use intermittent FMLA to work a reduced number of hours per day (or week) for the duration of their leave entitlement.
  • When both FMLA and ADA apply, the employee must receive the most beneficial protections.
  • FMLA entitlement is 12 workweeks and is measured based on the regularly scheduled hours in a workweek.

Discussion

The Wage and Hour Division of the U.S. Department of Labor recently issued an Opinion Letter addressing whether an employee may use intermittent Family and Medical Leave Act (FMLA) leave to work a reduced number of hours per day (or week) for the duration of their leave entitlement. The inquiry indicated that employees were required to work more than eight hours per day and working overtime was not optional.

The Opinion letter stated that where an employee is unable to work more than eight hours in a regularly scheduled day because of an FMLA-qualifying reason, the employee may use FMLA leave for the remainder of each shift, and the hours which the employee would have otherwise been required to work are counted against the employee’s FMLA leave entitlement.

The Opinion Letter highlighted the differences between the FMLA and the Americans with Disabilities Act (ADA), but acknowledged that an employee may be entitled to invoke the protections of both laws simultaneously. Where an employee qualifies under both the FMLA and ADA, requirements from both laws must be observed and applied in a manner that assures the most beneficial rights and protection to the employee.

Finally, the Opinion Letter reiterated FMLA entitlement for employees who are regularly scheduled to work more than eight hours per day. FMLA provides that an employee is entitled to 12 workweeks of leave per year. If an employee is regularly scheduled to work more than 40 hours per week, they are entitled to more than 480 hours of FMLA per 12-month period.

 

Action Items

  1. Review the Opinion Letter here.
  2. Have FMLA and ADA policies reviewed for compliance.
  3. Have appropriate personnel trained on FMLA eligibility and entitlement.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

EEOC Updated Guidance on Hearing Disabilities in the Workplace

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All Employers with 15+ Employees

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January 24, 2023

  

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  • The ADA covers disabilities involving those with hearing conditions.
  • The EEOC updated its technical assistance document to provide additional guidance on hearing conditions and employer responsibilities in an FAQ format.
  • The technical assistance document also includes examples of reasonable accommodations for hearing conditions.

Discussion

The U.S. Equal Employment Opportunity Commission (EEOC) updated its Hearing Disabilities in the Workplace and the Americans with Disabilities Act technical assistance document. This resource covers various issues related to employees and job applicants with hearing disabilities and addresses them in a question-and-answer format. Topics covered include: 1) when an employer may ask an applicant or employee questions about a hearing condition and how it should treat voluntary disclosures; 2) what types of reasonable accommodations applicants or employees with hearing disabilities may need; 3) how an employer should handle safety concerns about applicants and employees with hearing disabilities; and 4) how an employer can ensure that no employee is harassed because of a hearing disability or any other disability.

The EEOC reinforces that employers should not ask applicants about their medical conditions. However, employers are permitted to ask questions regarding an applicant’s ability to perform the essential functions of the position, with or without a reasonable accommodation. More specifically, the EEOC provides examples of reasonable accommodations for those with hearing disabilities, including: a sign language interpreter; assistive technology like hearing-aid compatible headsets, video remote interpreting services, hearing protection equipment, assistive software or applications and accessible emergency notification systems; appropriate written memos and notes; work area adjustments; time off; altering non-essential job functions; and reassignment to a vacant position. Employers should review the additional guidance offered for reasonable accommodations and evaluate the options best suited for their workplace and job positions.

 

Action Items

  1. Review the EEOC’s technical assistance document here.
  2. Have policies and procedures updated regarding reasonable accommodations under the ADA.
  3. Have appropriate personnel trained on ADA requirements.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

Sixth Circuit: Expanded Retaliation Protections for FMLA Leave

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All FMLA Employers with KY, MI, OH, and TN Employees

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January 25, 2023

  

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  • Employees requesting leave that may be covered under the FMLA are protected for exercising a leave request even if they are not eligible for FMLA leave.
  • Employers, not employees, are responsible for gathering the information required to determine whether leave complies with the FMLA.

Discussion

In Polina Milman v. Fieger & Fieger P.C., the Sixth Circuit Court of Appeals ruled an employee’s request for unpaid leave under the Family and Medical Leave Act (FMLA) is protected activity and subject to protection against retaliation even if the employee was ineligible for FMLA leave. A request that raises the question of a potential right to FMLA leave is sufficient. Here, the employee was an attorney at a law firm and requested permission to work remotely due to the start of the COVID-19 pandemic. The employee was concerned about working in person as her son was vulnerable to infection and was exhibiting symptoms of COVID-19. She was denied her remote work request, so she then requested to take unpaid leave without mentioning the FMLA. Human Resources instead allowed her to work from home for a few days. When the plaintiff did not return to the office after the remote work allowance ended, she was terminated. She then sued for FMLA retaliation and state law claims.

In its ruling, the Court said that an employee did not have to make a specific request for leave in order to be protected from retaliation. It was enough that the request raised the question of a possible right to FMLA leave even if the employee ultimately was not eligible for FMLA leave. The employer, not the employee, has the burden of collecting enough information to determine whether the leave complies with the requirements of the FMLA. Here, the employee expressed sufficient legitimate FMLA concerns like needing to attend to her child’s health issues at the onset of the COVID-19 pandemic. These concerns are enough to raise the issue of whether the request reasonably may fall under the FMLA. Also, the employer’s offer of an alternative accommodation to work from home was an indication that the employer was aware of the plaintiff’s request. Employers should review their obligations under the FMLA and determine whether an employee qualifies for leave. Employers should also discuss any potential adverse actions contemplated against an employee requesting leave with their legal counsel.

 

Action Items

  1. Review procedures for responding to and managing leave requests.
  2. Have appropriate personnel trained on the requirements.
  3. Discuss potential adverse actions against employees requesting leave with legal counsel.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

Seventh Circuit: Unworked Portions of Bona Fide Meal Periods Are Unpaid

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All Employers with WI Employees

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January 31, 2023

  

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  • If an employer provides a bona fide meal period, any unworked portion of the meal period is unpaid, even if the employee voluntarily shortens the meal period to under 30 minutes.

Discussion

In Wirth v. RLJ Dental, the Third Circuit Court of Appeals stated that Wisconsin law does not require employers to pay for the unworked portion of a bona fide meal period where the employee is relieved of all duty but voluntarily chooses to shorten their meal period. In Wisconsin, a bona fide meal period is unpaid if it relieves the employee of all duty, including to leave the premises, for at least 30 minutes.

There, an employee was given an hour for lunch, during which time the office shut down, and the employee was not required to work and free to leave the premises. However, despite being admonished not to, the employee would clock in to work before the meal period was complete. The employee was still paid for all time in which she was clocked in and working, but she claimed she should have been paid for the full meal period (including time clocked out, not working) even though she voluntarily elected to take less than 30 minutes for lunch.

The Third Circuit did not focus on whether the employee voluntarily elected to end a meal period early, but rather on the employer’s fulfillment of its obligations. Where the employer provides at least 30 minutes for a duty-free meal period, the unworked portion of the meal period is not compensable. Employers must take care to ensure that bona fide meal periods are provided before declining to compensate employees during meal periods.

 

Action Items

  1. Have meal period policies reviewed for compliance.
  2. Have appropriate personnel trained on meal period practices.
  3. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

Ninth Circuit: FAA Preempts California’s Prohibition on Mandatory Arbitration

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February 15, 2023

  

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  • The Ninth Circuit Court of Appeals ruled the Federal Arbitration Act preempted AB 51 which frees California employers to use mandatory arbitration agreements, absent further appeals.

Discussion

In Chamber of Commerce v. Bonta, the Ninth Circuit Court of Appeals, on rehearing, ruled AB 51 is preempted by the Federal Arbitration Act (FAA). In 2020, AB 51 prohibited employers from requiring employees to enter into arbitration agreements as a condition of employment in which employees waived the right to litigate claims under the Fair Employment and Housing Act (FEHA) and the California Labor Code. As a result of a legal challenge, the Ninth Circuit previously upheld AB 51 indicating that AB 51 applied before an arbitration agreement was entered into but not after, an “oddity that an employer subject to criminal prosecution for requiring an employee to enter into an arbitration agreement could nevertheless enforce that agreement once it was executed.” Subsequently, after a request for rehearing en banc, and following the U.S. Supreme Court ruling in Viking River Cruises v. Moriana also involving FAA preemption over California arbitration agreements, a Ninth Circuit panel reviewed this case again and came out with a different result.

Specifically, state rules that burden or invalidate the formation of arbitration agreements hinder the FAA. The FAA not only governs applicable arbitration agreements but also encourages them as an alternative to litigation. The court’s ruling was based on conflict preemption which means a state law either creates an unacceptable obstacle to the accomplishment and execution of the full purposes and objectives of Congress or makes it impossible to comply with both state and federal requirements. Following this rationale, the court found AB 51 made the formation of an arbitration agreement invalid and gave no purpose or meaning to the FAA. Although AB 51 did not expressly ban arbitration agreements, it did place a severe burden on contract formation through civil and criminal penalties imposed on employers. The court stated that the threat of penalties is intended to have a deterrent effect and inhibits an employer’s willingness to create an arbitration contract with employees.

Additionally, Congress intended to place arbitration agreements on the same footing as other contracts, and AB 51 defeated that purpose. The court noted AB 51 singled out arbitration agreements as unlawful contracts although employers are able to enter into nonnegotiable contracts, for example, relating to compensation or drug usage. Under this ruling, employers can continue to use mandatory arbitration agreements, absent additional appeals.

 

Action Items

  1. Review arbitration agreements with legal counsel for compliance.
  2. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

D.C. Circuit: NLRB 2019 Election Rule Not Properly Implemented, Now Stayed

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All Employers subject to NLRA

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January 17, 2023

  

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  • NLRB 2019 final rule on union elections is currently stayed and previous regulations are reinstated.
  • Four provisions of the 2019 rule were invalidated on procedural and substantive grounds; although two provisions remained, they are not being implemented pending current litigation and the NLRB’s review of the rule itself.

Discussion

In AFL-CIO v. NLRB, the D.C. Circuit Court of Appeals stated that portions of the National Labor Relations Board’s (NLRB) 2019 final rule on union elections were not properly implemented. Specifically, the 2019 rule provisions regarding the timeline for submission of employee voter lists, the timeline for certification of election results, and eligibility of election observers, were substantive in nature and did not follow the proper procedures requiring notice and comment periods before issuance. However, the rule’s provisions for pre-election litigation of certain voter eligibility issues and the time period for scheduling elections were procedural and therefore properly enacted.

The D.C. Circuit also held that a provision in the 2019 rule providing for automatic impoundment of ballots under certain circumstances when a petition for review is pending with the Board is contrary to the National Labor Relations Act (NLRA). As a result, previous NLRB regulations for union elections were reinstated.

Subsequently, on March 9, 2023, and in light of the D.C. Circuit ruling, the NLRB announced recission of the four invalidated provisions of the 2019 rule. The Federal Register also filed for public inspection a notice staying the effective date of the two procedural provisions of the 2019 Rule to September 10, 2023. The Board stated it will continue to postpone implementation of these provisions as litigation remains pending and while the Board considers whether to revise or repeal the 2019 Rule. Continue to look for updates on this topic.

 

Action Items

  1. Have union election procedures updated for compliance.
  2. Review the NLRB rescission here.
  3. Review union election requirements with legal counsel.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase

California: CPRA Enforcement is Expected to Come as Early as April 2023

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All Employers Subject to the CPRA with CA Employees

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January 1, 2023

  

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  • Provisions of CPRA require a business’ workforce personal information to fall under the same protections and consumer rights requirements as those of the business’ consumers.
  • The final regulations implementing the CPRA are now before the Office of Administrative Law for final approval and should go into effect as early as April.

Discussion

The long-awaited regulations for the California Privacy Rights Act (CPRA) have been sent to the Office of Administrative Law and appear to be ready to go into effect this spring. Despite the lack of final regulations, the CPRA’s amendments to the California Consumer Privacy Act (CCPA) went into effect on January 1, 2023. These amendments removed the exemption for workforce personal information to be exempt from the CCPA consumer data privacy amendments. Workforce members include California applicants, employees, and independent contractors. The CPRA applies to all businesses (regardless of location) with annual gross revenues exceeding $25 million or who buy, sell, or share consumers’ personal information at certain thresholds.

Workforce members are entitled to certain consumer rights regarding their personal information: 1) the right to know what personal information is collected and how it is used; 2) the right to correct incorrect personal information; 3) the right to delete personal information; 4) the right to opt-out of the sale or sharing of sensitive personal information; 5) the right to limit the use of sensitive personal information; and 6) the right to be free from retaliation or discrimination for the exercise of these rights. These rights have certain limitations, especially in an employment setting. Employers, for example, do not have to comply with a rights request if the information needs to be retained to comply with other applicable laws. Employers should not wait for the final regulations to be approved to move ahead with compliance since there are a number of complicated requirements.

Employers will need to complete a data inventory of all of their workforce personal information. This includes locating the data, and identifying the storage format, storage method, and storage location as well as the physical location. This process must also be repeated amongst any vendors or third parties with whom employers share or sell any workforce personal information. Once personal information is identified, it must be categorized based on its type and business purpose or use as stated in the CPRA. Employers also need to create and update privacy policies as well as notices to provide to workforce members at the point personal information is collected. Contracts with third parties must also include language referencing the third parties’ obligations under the CPRA.

Employers must create an internal process for directing workforce members who want to exercise their consumer rights to the submission methods for such requests and responding to a rights request. In addition, employers must train the employees responsible for managing workforce personal information and responding to rights requests on the basic requirements of the CPRA as well as its specific privacy policy, notice requirements, and rights request submission and response methods. Employers must retain records relating to any rights request submissions and responses for 24 months or as required under other applicable law.

Although the final regulations have yet to go into effect, employers should work with their legal counsel now to implement the requirements. Many of the obligations under the CPRA require specific knowledge about each individual business’ personal information collection, use, and storage practices.

 

Action Items

  1. Locate and map all workforce personal information.
  2. Draft notices of collection and privacy and retention policies for workforce personal information.
  3. Train appropriate personnel on directing workforce members on how to exercise their consumer rights and responding to rights requests.
  4. Review notices, policies, procedures, and third-party contracts with legal counsel.
  5. Review the CPPA’s website for more information.
  6. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2023 ManagEase