Hunton Employment & Labor Perspectives

Employers need to prepare themselves for the very real possibility of immediate and significant changes in the union election process which could result in shortening the time in which elections will be conducted.  In August, we wrote about the numerous changes to the procedures governing union elections proposed by the National Labor Relations Board (“NLRB”) as part of its rulemaking process.  These proposed changes, which most prominently include reducing the amount of pre-election litigation and shortening the time between the filing of a petition and the election, with elections being held as early as 10 days after a petition is filed, are significant.  If adopted, these changes would both alter the landscape of secret ballot elections and place employers at a severe disadvantage by giving them much less time to respond to organizing campaigns.

Imagine the following scenario…  Twenty years ago, your Company was the employer at issue in a key Supreme Court of Virginia non-compete agreement case.  Your Company prevailed, with the Supreme Court holding that the Company’s standard non-compete agreement is enforceable under Virginia law.  Relying on that victory, your Company continues using identical non-compete language and believes that it is on firm footing in doing so; after all, the Supreme Court of Virginia - the final arbiter of the meaning of Virginia law - has ruled that your non-compete is enforceable.

CONTINUE ...

Thirty-four percent of adults in the United States presently qualify as obese under standards adopted by the Center for Disease Control.  Morbid obesity (defined as having a body weight more than 100% over the norm) and obesity caused by a psychological disorder are "disabilities" as defined by the Americans With Disabilities Act (“ADA”), according to the EEOC.  Lawsuits involving morbid obesity are on the rise and come in many shapes and sizes.  The most common involves a “substantially limiting” health condition such as diabetes, heart disease, and hypertension.  Others involve employers who assume an obese employee would pose a direct threat to the health and safety of him or herself or other employees if he or she were to carry out the essential functions of the job.

A little known law that permits the disabled to be paid sub-minimum wage is currently under attack. To foster employment opportunities for disabled workers in the mainstream workforce, the Fair Labor Standards Act (FLSA)  has contained, since its passage, a relatively unknown provision under Section 14(e) that allows employers to pay disabled workers sub-minimum wages as long as the wages are commensurate with the disabled worker’s productivity. The prerequisites to paying sub-minimum wage to the disabled are stringent and include:

• Preparing a job description for the employee that identifies duties and responsibilities, skills required, and specifies the days and hours of work;
• Identifying the prevailing wage for the position compiled internally or, if necessary, from similar businesses in the area;
• Determining the productivity level of the disabled employee compared to non-disabled workers (e.g., through time/motion studies); and
• Submitting the information on an application to the Secretary of Labor for a special wage permit allowing for the payment of sub-minimum wages.

On October 9, 2011, California Governor Jerry Brown signed SB 459, legislation that creates new and significant civil penalties for employers that misclassify employees as independent contractors. The newly enacted Section 226.8 of the California Labor Code authorizes civil penalties under two circumstances: (1) “Willful misclassification of an individual as an independent contractor;” and (2) “Charging an individual who has been willfully misclassified as an independent contractor a fee, or making any deductions from compensation, for any purpose . . . .” In either case, the “person or employer” responsible for the violation “shall be subject to a civil penalty of not less than five thousand dollars ($5,000) and not more than fifteen thousand dollars ($15,000) for each violation, in addition to any other penalties or fines permitted by law.” Moreover, if there is a determination that a person or employer has engaged in “a pattern or practice” of violations, “the person or employer shall be subject to a civil penalty of not less than ten thousand dollars ($10,000) and not more than twenty-five thousand dollars ($25,000) for each violation.”

California Governor Jerry Brown recently signed into law Senate Bill No. 559 (SB 559), which prohibits discrimination based on an individual’s genetic information.  While SB 559 significantly expands the protections from genetic discrimination provided under the federal Genetic Information Nondiscrimination Act of 2008 (GINA), at this time, its impact on most California employers is thought to be limited to the potential for greater damages to be awarded under it than under its federal counterpart.

On October 10, 2011, California became the seventh state to enact legislation restricting public and private employers alike from using consumer credit reports in making hiring and other personnel decisions.  Assembly Bill No. 22 both adds a new provision to the California Labor Code -- Section 1024.5 -- and amends California’s Consumer Credit Reporting Agencies Act (“CCRAA”).  Effective January 1, 2012, California employers will be prohibited from requesting a consumer credit report for employment purposes unless they meet one of the limited statutory exceptions, and those employers meeting an exception, will be subjected to increased disclosure requirements.  Connecticut, Illinois, Hawaii, Oregon, Maryland and Washington already have similar laws on the books, and many other states, as well as the federal government, are contemplating similar legislation.  This trend creates a potential “credit-centric” minefield for employers that do business in any one or more of these states.  In light of the multiple laws affecting their use, employers who utilize consumer credit reports in making personnel decisions should proceed cautiously.  Employers must evaluate the need for these reports in making personnel decisions, review and modify their policies to ensure compliance with the myriad of regulations in this area, and monitor any new developments to ensure continued compliance. 

On October 3, 2011, the U.S. Supreme Court vacated the Ninth Circuit’s decision in Wang v. Chinese Daily News, Inc., 623 F.3d 743 (9th Cir. 2010), and remanded it “for further consideration in light of Wal-Mart Stores, Inc. v. Dukes, 564 U.S. ___ (2011).” The Supreme Court did not provide any further analysis of the Wang decision in its granting of the petition for a writ of certiorari.

On September 28, 2011, an Illinois federal district court dismissed the putative class action claims brought by U.S. Equal Employment Opportunity Commission (EEOC) against United Parcel Service Inc. (UPS) in a case where the EEOC alleged that UPS’s 12 month medical leave policy violated the Americans With Disabilities Act by not providing reasonable accommodations to disabled employees.  (EEOC v. United Parcel Service Inc., N.D. Ill, No. 1:09-cv-05291.)

On October 4, 2011, the California Supreme Court announced that it will hear oral argument in Brinker v. Superior Court (Hohnbaum) on Tuesday, November 8, 2011, at 9:00 a.m. in San Francisco.  Because the Court’s procedures typically require it to file its written opinion within 90 days of oral argument, employers can reasonably expect a decision in the case sometime between December 2011 and February 2012.

The long-awaited decision is expected to provide clarity concerning the proper interpretation of California’s statutes and regulations governing an employer’s duty to ...