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PA Bill Would Ban Nondisclosure Agreements for Sexual Misconduct

November 17, 2017

By Jo Bennett

In response to a surge of sexual misconduct allegations throughout the country, Democratic state senators in Pennsylvania on Wednesday announced legislation that would ban agreements that hide the identity of persons accused of sexual assault or harassment. Senate Bill 999 takes aim at nondisclosure agreements (NDAs), in which the aggrieved party typically agrees not to pursue litigation or discuss the terms of the agreement in exchange for a sum of money.

The bill would prohibit Pennsylvania courts from enforcing nondisclosure agreements in civil lawsuits stemming from sexual misconduct allegations. It also would prohibit the destruction of evidence under such agreements. And it would void pre-existing agreements if a party to the agreement entered into the contract under duress, impaired, or while a minor. The proposed law would still protect the identity of the victims. Similar legislation has been proposed in California and New York.

We will continue to report on developments with Senate Bill 999.

For more information regarding this or other labor and employment issues, please contact Jo Bennett, co-chair of Schnader’s Labor and Employment Practices Group.   

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

3rd Circuit Rules Employers Must Pay for Short Breaks

November 7, 2017

By Michael J. Wietrzychowski

A recent case in the Third Circuit Court of Appeals serves as an important reminder that employers must pay workers for short breaks.  The opinion by Judge McKee in Secretary United States Department of Labor v. American Future Systems, Inc. d/b/a Progressive Business Publications was issued October 13, 2017 and can be found here.

Progressive Business Publications pays its sales representatives an hourly wage.  It previously had a policy giving employees two fifteen-minute paid breaks per day. In 2009, it eliminated the paid breaks, instead allowing employees to log off their computers at any time, calling it “flexible time.” However, if the employees were logged off for more than 90 seconds, they were not paid for the break. The unpaid breaks included time to use the bathroom, get coffee, or to take a moment in between sales calls to prepare for the next call. As a result, the employees were being paid just over five hours per day.

The Department of Labor brought suit against Progressive alleging it violated the Fair Labor Standards Act (FLSA) by failing to pay the federal minimum wage to employees subject to this policy. The District Court granted the Department’s motion for partial summary judgment on the minimum wage claim and Progressive appealed.

In the opinion, Judge McKee had this to say about Progressive’s “flexible time” policy: “The policy that Progressive refers to as ‘flexible time’ forces employees to choose between such basic necessities as going to the bathroom or getting paid unless the employee can sprint from computer to bathroom, relieve him or herself while there, and then sprint back to his or her computer in less than ninety seconds.”  In a footnote, Judge McKee wonders if this feat is even possible, absent the employee having access to a Portkey (in the Harry Potter series, an object used to transport wizards from one spot to another).

Judge McKee then found that Progressive’s “flexible time” policy is in fact a break policy to which the FLSA applies, and that Progressive violated the FLSA by failing to pay its employees for rest breaks of twenty minutes or less.

Under the federal law, breaks that are under 20 minutes must be paid – with very narrow exceptions.  Therefore, employers who permit employees to take breaks lasting under 20 minutes should be aware that such breaks most likely need to be paid.  This may include, for example, splitting break time that ordinarily is unpaid – such as splitting an unpaid 30-minute lunch break into two 15 minute breaks because the business requires the break be interrupted.  To ensure compliance with the law, Employers should have policies directing employees and managers on paid and unpaid break time, and that unpaid breaks of over 20 minutes must be taken in their entirety.  Employers also should monitor break time practices to ensure policy compliance.

For more information regarding this or other labor and employment issues, please contact Michael J. Wietrzychowski, co-chair of Schnader’s Labor and Employment Practices Group.   

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

Uber Driver Compensation Claims Survive Summary Judgment in EDPA

October 3, 2017

By Samantha Banks

On September 13, U.S. District Judge Michael Baylson of the Eastern District of Pennsylvania denied Uber’s motion for partial summary judgment in Razak v. Uber Technologies. It is the first time a district court in the Third Circuit is addressing the issue of compensation for Uber drivers.

The case is a putative class action and concerns Uber Black drivers, who provide limo services. The drivers claim Uber violated the Fair Labor Standards Act (FLSA) overtime and minimum wage requirements. They are seeking compensation for time spent online (while they were available to accept rides) but not transporting riders.  Uber argued the time cannot be compensable because the drivers can go offline any time.

Pointing out that drivers have only 15 seconds to respond to a trip request, Judge Baylson noted this requirement “may reasonably be considered” that “drivers are required by Uber to be tethered to their phones while online. Similarly, that drivers are automatically switched from online to offline after ignoring three trip requests could reasonably be considered a severe restriction on their ability to engage in personal activities.”

The court ordered the parties to complete discovery and to address whether Uber drivers are employees or independent contractors under the FLSA.   Although currently being addressed in other Circuits, this will be an interesting case to watch.  In June, a New York Department of Labor administrative judge ruled that Uber drivers are employees under state law and entitled to unemployment benefits in a case concerning an Uber black-car subsidiary. There, the court held that Uber’s exercising supervision and control over the drivers created an employer-employee relationship.  Uber is appealing that judgment.

As more service-oriented companies enter the market, whether employers classify workers as employees or independent contractors will become even more significant.  We will continue to monitor developments in these cases.

For more information regarding this or other labor and employment issues, please contact Jo Bennett or Michael Wietrzychowski, co-chairs of Schnader’s Labor and Employment Practices Group.   

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

Crucial Labor and Employment Issues on the Line in Landmark U.S. Supreme Court Case

September 29, 2017

By Jo Bennett

UPDATE 10-04-2017

The oral argument before the U.S. Supreme Court on Monday, October 2, was reported in the media as reflecting a deeply divided Court. It was noted that many thousands of employers and 25 million employees from coast to coast will be affected by the decision in this case.

Questions from Chief Justice Roberts and Justices Alito and Kennedy seemed to indicate their understanding of the need identified by employers to resolve the tension between the Federal Arbitration Act and the National Labor Relations Act in a way that allows employers to efficiently resolve workplace disputes through arbitration. Deputy Solicitor General Jeffrey Wall argued in support of this position, saying: “It is a fundamental attribute of arbitration, and this Court said it three times [in past decisions], to pick the parties with whom you arbitrate. And our simple point is this case is at the heartland of the FAA. It is, at best, at the periphery of the NLRA, on the margins of its ambiguity, and you simply can’t get there under the Court’s cases.”

Justices Thomas and Gorsuch did not ask questions during the oral argument. It has been reported that Justice Gorsuch has supported the use of arbitration and sought to limit the scope of the NLRA in cases he decided as an appellate judge before joining the Supreme Court.


The U.S. Supreme Court will hear oral argument on Monday, October 2 in Epic Systems Corp. v. Lewis, an important labor and employment case in which Schnader has filed an amicus brief on behalf of the Mortgage Bankers Association and State Mortgage Lending Associations.

The appeal, which consolidates three cases from different federal circuits, addresses whether an employer can require employees to resolve work-related disputes through individual arbitration and not through collective actions. The issue before the Court points up the tension between the Federal Arbitration Act, which encourages arbitration of disputes, and the National Labor Relations Act, which gives employees the right to engage in concerted activity.

This case has drawn significant national interest, and not just from industry insiders. Articles about the case have appeared in USA Today and Newsweek. More than two dozen “friend of the court” briefs have been filed. The switch in presidential administrations earlier this year resulted in a reversal of the official position of the federal government, which now supports the employers’ position for upholding contracts mandating individual arbitration.

Businesses have a lot at stake in this case. Employers, especially small employers, are concerned about controlling the costs and risks associated with employment-related disputes. Employers depend on the efficiency and cost savings of arbitration, as well as the predictability and enforceability of class and collective action waivers, to resolve work-related conflicts.

While the case before the Supreme Court remains pending, employers should be mindful of the uncertainty of the legality of class-action waivers. In general, however, many employers will benefit by working with its counsel to prepare legally enforceable arbitration agreements to resolve employee disputes.

Stay tuned as Schnader closely follows the oral arguments on October 2 and as we assess the ultimate decision of the Court as it impacts employers of all kinds throughout the country. Follow us on SchnaderWorks and on Twitter @Schnader.

For more information regarding this or other labor and employment issues, please contact Jo Bennett, co-chair of Schnader’s Labor and Employment Practices Group.   

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

Another Court Finds That Accessibility Rules Apply to Retail Websites

September 14, 2017

By Karen Baillie

Last month we told you that a court in Florida had ordered the Winn-Dixie supermarket chain to make its websites accessible to persons with vision impairments by following the Web Content Accessibility Guidelines 2.0 standards (WCAG 2.0).  This month, another court has weighed in.  In an opinion published on September 6, 2017 (but issued earlier on July 31, 2017), Judge Jack B. Weinstein of the Southern District of New York ruled that a retail website was a place of public accommodation under the Americans with Disabilities Act (as well as under state and local law) and therefore the owner the website had to take “the steps necessary to ensure that the blind have full and equal enjoyment of its website – provided that taking such steps would not impose an undue burden on Blick or fundamentally alter the website.”  Andrews v. Blick Art Materials, LLC, 17-CV-767, NYLJ 1202797331595, at *15 (EDNY, Decided July 31, 2017).

Judge Weinstein rejected Blick’s argument that web-only services need not be accessible.  Rather, the court held that a website could be a place of public accommodation and that the purpose of the ADA is to ensure equal access to persons with disabilities.  The court thought it would be “absurd” to conclude otherwise.  “A rigid adherence to a physical nexus requirement leaves potholes of discrimination in what would otherwise be a smooth road to integration.  It would be perverse to give such an interpretation to a statute intended to comprehensively remedy discrimination.” Id. at *23.

Likewise, the court also rejected the argument that the Department of Justice’s failure to issue specific rules for website accessibility for public accommodations was no excuse for delay:  “The plaintiff has made a prima facie case that Blick is violating his rights under the ADA.  The court will not delay in adjudicating his claim on the off-chance the DOJ promptly issues regulations it has contemplated issuing for seven years but has yet to make significant progress on.”  Id. at *32.

Blick also argued that because there were no rules it was impossible to comply.  Judge Weinstein acknowledged that the lack of specific rules did lead to uncertainty about compliance, but he pointed out that the ADA is meant to be flexible, with lots of gray area:

“But the anti-discrimination provisions the defendant is accused of violating are not simple checklists of clear-cut rules- they are standards that are meant to be applied contextually and flexibly.  The ‘gray’ the defendant complains of is a feature of the Act.

The ADA requires public accommodations to provide ‘reasonable modifications’ or ‘auxiliary aids or services’ to disabled individuals to ensure them the ‘full and equal enjoyment’ of the goods, services, and accommodations places of public accommodation provide; public accommodations do not discriminate if the modifications needed are unreasonable or would ‘fundamentally alter the nature’ of the good, service or accommodation; they also do not discriminate if the provision of auxiliary aids or services would be ‘unduly burdensome’…  Id. at *33-34.

This decision reminds us that advocacy groups and others are filing lawsuits to enforce website accessibility.  Businesses that maintain websites are advised to discuss universal accessibility with their website designers so that they are prepared to address these issues.

For more information regarding this or other labor and employment issues, please contact Karen Bailliea member of Schnader’s Labor and Employment Practices Group. 

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

NJ Appellate Court Tosses Employee Arbitration Agreement

August 31, 2017

By Michael J. Wietrzychowski

In Dugan v. Best Buy, an unreported decision (thus far) by the New Jersey Appellate court, we are again reminded of the requirement that an employee’s waiver of the right to sue contained in an employee-employer arbitration agreement must be clear and unambiguous, and any waiver that falls short of this exacting standard will not be enforced under New Jersey law.

Please click here to read more.

For more information regarding this or other labor and employment issues, please contact Michael J. Wietrzychowski, co-chair of Schnader’s Labor and Employment Practices Group.

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

 

 

BREAKING: Pay Data Rules Placed on Hold for EEO-1 Form

August 30, 2017
tags:

By Jo Bennett

The new rules announced in late 2016 revising the Employer Information EEO-1 report on pay data collection have been placed on hold.

On August 29, 2017, the Office of Management and Budget (OMB) informed the Equal Employment Opportunity Commission (EEOC) that OMB had initiated “a review and immediate stay of the effectiveness of those aspects of the EEO-1 form that were revised on September 29, 2016. These revisions include new requests for data on wages and hours worked from employers with 100 or more employees, and federal contractors with 50 or more employees. EEOC may continue to use the previously approved EEO-1 form to collect data on race/ethnicity and gender during the review and stay.”

The EEOC also announced: “The previously approved EEO-1 form which collects data on race, ethnicity and gender by occupational category will remain in effect. Employers should plan to comply with the earlier approved EEO-1 (Component 1) by the previously set filing date of March 2018.”

Read the EEOC announcement here and the OMB memo here.

Although many companies and their Human Resources teams no doubt are relieved that OMB has put on hold what many viewed as a burdensome data collection, employers should continue to be vigilant on compensation issues.  The EEOC’s strategic enforcement plan for 2017- 2021 continues the agency’s focus on gender-based pay discrimination in particular, and the Office of Federal Contract Compliance Programs, which has jurisdiction over federal contractors, continues its collection of detailed compensation data during compliance evaluations.

 

For more information regarding this or other labor and employment issues, please contact Jo Bennett, co-chair of Schnader’s Labor and Employment Practices Group.   

The materials posted on Schnader.com and SchnaderWorks.com are prepared for informational purposes only and should not be considered as providing legal advice or creating an attorney-client relationship. Please see our disclaimer page for a full explanation.

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