Hunton Retail Law Resource

On June 17, 2024, the U.S. Supreme Court agreed to take up a wage and hour case, E.M.D. Sales, Inc. v. Carrera, to address a circuit split regarding the standard of proof that employers must satisfy to show that employees are exempt from the minimum wage and overtime requirements under the Fair Labor Standards Act (“FLSA”).

In a February 3, 2021 decision, the US Court of Appeals for the Seventh Circuit determined that the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”) may require employers to provide employees with short-term paid military leave. Specifically, if an employer provides short-term paid leave for other comparable purposes such as sick time, jury duty, or bereavement, then the employer may need to do the same for military leave.

On October 15, 2020, the United States District Court for the Southern District of Texas granted conditional certification to a class of assistant managers (“AM”s) in 550 wireless retail stores across the country. In Martinez v. Mobilelink, assistant store managers in the wireless retailers’ stores alleged that they were regularly required to work unpaid overtime. The employees sought to certify a class consisting of all current and former AMs employed by Mobilelink from March 2017 through the present.

On August 3, 2020, the United States District Court for the Southern District of New York struck down portions of the DOL’s Final Rule regarding who qualifies for COVID-19 emergency paid sick leave under the Emergency Paid Sick Leave Act (“EPSLA”) and the Emergency Family and Medical Leave Expansion Act (“EFMLEA”), collectively referred to as the Families First Coronavirus Response Act (“FFCRA”).

In a favorable decision for retailers, a California federal court judge scaled back a proposed class action seeking to bring nationwide class claims. Plaintiff Todd Carpenter alleged that he bought a rodent habitat at a California PetSmart and that the habitat was defective in such a way that his rodents were able to chew through and escape. He filed a class action in the US District Court for the Southern District of California for violations of California consumer protection laws, violation of the Magnuson-Moss Warranty Act, and common law fraud. The plaintiff sought to represent a nationwide class consisting of all purchasers of the rodent habitat along with a California subclass. PetSmart moved to strike the nationwide class on the grounds that the court lacked personal jurisdiction over PetSmart with respect to the nationwide class.

Imagine a future in which Artificial Intelligence (AI) does the recruiting and hiring at US companies. Every new hire will be the uniquely perfect candidate whose skills, personality, presence, temperament and work habits are a flawless match for the job. Performance management and poor performance become extinct, relics from an age in which humans brought primitive instincts, biases and flawed intuition to hiring and employment decisions. While there are risks and challenges to employers in introducing this technology, manufacturers of AI software say that some version of that future may not be too far off. AI software such as Mya, HireVue and Gecko are among the numerous platforms that retail employers are now leveraging to hone in on and hire the best candidates more quickly. Generally speaking, AI interviewing products combine mobile video interviews with game-based assessments. The AI platform then analyzes the candidate’s facial expressions, word choice and gestures in conjunction with game assessment results to determine the candidate’s work style, cognitive ability and interpersonal skills.

Oregon’s Fair Work Week Act (also known as Oregon’s predictive scheduling law) (the “Act”) is proceeding full speed ahead and will add significant challenges and costs for retailers. The majority of the Act goes into effect on July 1, 2018. Following similar ordinances regulating employee hours passed at municipal levels in Emeryville, California; New York City; San Francisco; San Jose; Seattle; and Washington, D.C., Oregon becomes the latest jurisdiction and the first state to enact a predictive scheduling law. 

California is the land of employment legislation, and 2018 is shaping up to be another year of change. We are less than six months into the year, and already several bills that could significantly impact California businesses—for better or for worse—are pending in the California legislature.

As reported on Hunton’s Employment and Labor Perspective blog, earlier this month San Francisco amended its Fair Chance Ordinance, the city and county’s so-called “ban-the-box” legislation that limits how private employers can use an applicant’s criminal history in employment decisions. The amendments, which take effect on October 1, 2018, expand the scope and penalties of the San Francisco ordinance and add to the growing framework of ban-the-box legislation across California and other states.

In June, new laws will go into effect that restrict employers’ ability to request and use criminal history information about applicants in three jurisdictions: Kansas City, Missouri; the State of Washington; and the city of Spokane, Washington. Below are summaries of the new restrictions and links to the laws.

Last week, the United States Court of Appeals for the Second Circuit, sitting en banc, became the second federal appellate court to officially recognize a discrimination claim under Title VII based solely on the plaintiff’s sexual orientation. The Court’s decision in Zarda v. Altitude Express follows on the heels of the Seventh Circuit’s decision last April in Hively v. Ivy Tech Community College of Indiana, in which the Seventh Circuit also overturned its prior cases to recognize protections based on sexual orientation under Title VII.

Recently, President Trump announced that he sent names of four nominees to serve as commissioners on the five-member Federal Trade Commission (“FTC”) to the Senate for approval. If all four of the nominees are confirmed, it will still leave one remaining vacant seat on the FTC, which has been operating as a bipartisan two-member interim agency since early last year. The nominees, three of whom were announced last fall, consist of three Republicans—Joseph Simons, Noah Phillips and Christine Wilson—and one Democrat, Rohit Chopra.

On November 10, 2017, the New York Department of Labor released a set of proposed regulations affecting the Minimum Wage Order for Miscellaneous Industries and Occupations, which applies to most employers, except hotels and restaurants.

On August 2, 2017, the U.S. Senate confirmed one of President Trump’s two management-side appointees, Marvin Kaplan, to the National Labor Relations Board (“NLRB”) in a contentious vote along party lines. Kaplan was sworn in on August 10, 2017, for a term ending on August 27, 2020. 

If you are a retailer, you may have policies and procedures in place regarding who can speak on behalf of your company. Such policies may generally instruct employees not to speak to the press as a representative of the company, and to direct all media inquiries to a particular person or department. Similarly, if you are a retailer, you may have a policy in place that instructs employees to forward any reference requests to your human resources department. These commonplace policies allow retailers to control their public image and protect employee privacy, among other benefits. But, according to a recent decision by a National Labor Relations Board (“NLRB”) administrative law judge (“ALJ”), such policies may violate the National Labor Relations Act (“NLRA”) by interfering with, restraining or coercing employees in their right to engage in concerted activity.

The Second Circuit recently held that Rite-Aid lawfully fired a long-tenured pharmacist after he refused to comply with the company’s new mandate that pharmacists must administer immunizations. The court’s decision overturned a jury verdict of $2.6 million in the pharmacist’s favor and reminds employers what it takes to show that a given function is “essential” and what accommodations are reasonable. The former pharmacist had claimed Rite-Aid illegally discharged and retaliated against him, and refused to accommodate his disability—trypanophobia, or needle phobia—under the Americans with Disabilities Act and similar state law.

On March 6, 2017, an NLRB administrative law judge (“ALJ”) issued a ruling finding that a nonunion automotive manufacturing facility in Alabama violated Section 8(a)(1) of the National Labor Relations Act (“NLRA”) when it terminated three employees who walked off the job over a holiday-season scheduling dispute. The ALJ found that the employees were engaged in protected concerted activity despite the fact that they denied discussing the decision to leave work before their shifts had ended.

On January 25, 2017, Victoria Lipnic was appointed acting chair of the Equal Employment Opportunity Commission (“EEOC”), and members of the legal community believe that her appointment could move the EEOC in a more management-friendly direction. Lipnic has served as a Commissioner of the EEOC since 2010, having been nominated by Barack Obama to two consecutive terms, the second of which is set to expire in 2020. Immediately prior to joining the EEOC, Lipnic was a management-side labor and employment attorney for an international law firm and also served as the U.S. Assistant Secretary of Labor for Employment Standards from 2002 until 2009 under President George W. Bush. In that position, she oversaw the Wage and Hour Division, the Office of Federal Contract Compliance Programs, the Office of Workers’ Compensation Programs and the Office of Labor Management Standards.

On January 22, 2017, the City of Los Angeles will ‘ban the box’ when the Los Angeles Fair Chance Initiative for Hiring (Ban the Box) (the “Initiative”) goes into effect, prohibiting private employers in Los Angeles “from inquiring into or seeking a job applicant’s criminal history unless and until a conditional offer of employment” is made to the individual. In doing so, Los Angeles will become the fourth California city to ‘ban the box’ with greater protections than the state statute, and the second to do so with respect to private employers. If an employer makes a conditional offer of employment and then receives information about an applicant’s criminal history, the employer cannot take an adverse employment action against the applicant based on that history until (1) a written assessment has taken place and (2) a Fair Chance Process has occurred.

Recently, President-elect Donald Trump tapped Andrew Puzder as his pick for Secretary of Labor. Puzder—the CEO of Hardee’s and Carl’s Jr.—has been an outspoken critic of government regulations, including efforts to increase the minimum wage and recent changes to the white-collar overtime exemption. If the Senate confirms Puzder, he will oversee the agencies responsible for these policies and his confirmation could signal a slowdown of anti-business federal regulations from the Department of Labor under President Obama’s Secretary of Labor, Thomas Perez.

With Christmas falling on a Sunday this year, employers should be mindful of state blue laws, which sometimes require premium pay to hourly employees working on Sundays or holidays. Although most state laws, as well as federal law, do not require premium pay for work performed on holidays (unless, of course, the employee has worked more than 40 hours that week), there are a few exceptions, such as Massachusetts and Rhode Island. 

Recently, the EEOC has announced the approval of a revised EEO-1 report (“Revised Report”), applying to the 2017 calendar year with the first report due by March 31, 2018. In addition to the disclosures required by the current EEO-1 report, the Revised Report will require employers with 100 or more employees to provide compensation data and the number of hours worked by employees across 12 separate pay bands, categorized by gender, race and ethnicity. The current EEO-1 report only collects data regarding the number of employees categorized by gender, race and ethnicity in 10 different job groupings.

Under the Fair Labor Standards Act’s (“FLSA’s”) white-collar exemptions, an employee must meet both a duties and a salary basis test in order to be exempt from overtime requirements. Currently, the salary basis test requires that the employee receive at least $455 per week in salary. However, under a recent Department of Labor rulemaking, the weekly salary amount is set to more than double to $913 per week effective December 1, 2016. Thus, employers must ensure that any white-collar-exempt employee making less than $913 per week either (1) receives a salary increase to at least $913 per week to continue the overtime exemption or (2) is reclassified to non-exempt and receives overtime when working more than 40 hours in a week. 

The issue of religious background has generated substantial discussion during the current election cycle. Recently, the federal government highlighted the issue of religious discrimination and accommodation in the workplace. 

In December 2014, the New York Attorney General’s Office initiated an investigation into Jimmy John’s corporate office and its New York franchises. Jimmy John’s is a sandwich shop with franchises throughout New York and the United States. The investigation in New York concerned whether the use of a non-compete clause that barred departing employees from taking a job with any employer within two miles of a Jimmy John’s store that made more than 10 percent of its revenue from sandwiches was legal.

Recently, Washington D.C. councilmembers unanimously voted to increase the city’s minimum wage to $15.00 an hour by the year 2020 for non-tipped hourly workers, many of whom work in the retail industry. The news comes just before Washington D.C. is scheduled to increase its minimum wage rate from $10.50 an hour to $11.50 an hour on July 1, 2016. The move makes D.C. the third jurisdiction behind California and New York to increase minimum wages to $15.00 an hour.

Seattle may be the next municipality to propose a predictable scheduling ordinance requiring employers to provide advanced notice of work schedules and compensation in the event schedules are changed. The Seattle City Council’s Civil Rights, Utilities, Economic Development and Arts Committee recently initiated regular meetings to discuss the issue of “Secure Scheduling,” and confirmed plans to continue discussions over the next several months to further develop the proposed ordinance. The Mayor’s office is also pursuing its own inquiry into this issue. 

This post has been updated. 

In the midst of the press and politics currently surrounding the issue of bathroom policies and laws with respect to transgender employees, it is helpful to remember that government organizations have been issuing guidance to employers to assist them in dealing with these issues, especially in places where gender identity and expression constitute protected characteristics under anti-discrimination laws.

The Missouri Legislature is considering an amendment to the state’s constitution that would prohibit the state from imposing penalties on individuals who, due to sincere religious beliefs, refuse to participate in or provide goods and services for marriages or wedding ceremonies of same-sex couples. The “religious freedom” bill has been approved by the Missouri Senate and is currently pending before the House of Representatives. If the bill is passed, the proposed constitutional amendment will appear on the state’s ballot in November.

As reported in the Hunton Employment and Labor Law Blog, on March 1, 2016, the United States Equal Employment Opportunity Commission (“EEOC”) sued employers for the first time for sexual orientation discrimination. The EEOC filed lawsuits in federal courts in Pittsburgh and Baltimore against manufacturing and health care employers for unlawful sex discrimination on behalf of employees alleging they were harassed and discriminated against based on their sexual orientation.

As reported on the Hunton Employment and Labor Law Blog, the United States Supreme Court has denied a restaurant manager’s petition seeking review of whether parties may stipulate to the dismissal with prejudice of a lawsuit alleging violations of the Fair Labor Standards Act (“FLSA”), or whether judicial or Department of Labor (“DOL”) approval is a prerequisite to such a dismissal, as the Second Circuit held in his case, Cheeks v. Freeport Pancake House, Inc. Having declined the petition for writ of certiorari, FLSA lawsuits will remain more difficult to resolve for employers in New York, Connecticut and Vermont.

Earlier this month, a group of former delivery drivers filed a putative collective action lawsuit against an online retailer and Courier Logistics Services, LLC (“CLS”). The case is pending before the United States District Court for the District of Arizona. The plaintiffs allege that the two companies willfully misclassified them as independent contractors and denied overtime pay properly due under the federal Fair Labor Standards Act (“FLSA”).