Changes to Nation’s Employment Laws

Dorsey’s Analysis of Changes to the Nation’s Employment Laws

The advent of the Obama Administration is likely to result (and already has resulted) in sweeping changes to federal labor and employment laws and, accordingly, the relationship between employers and their employees. As we approach the 100th day of the new Administration, we have compiled a user-friendly summary guide to several key pieces of labor and employment legislation that are either pending before or likely to be revisited by the 111th Congress. Among other things, these laws underscore the Obama Administration’s stated commitments to strengthening anti-discrimination protections, repositioning the work/family balance, and reinvigorating unions. We will continue to monitor these and other legislative developments and will issue updates to ensure our clients stay ahead of the curve on impending changes.

A. Strengthening Anti-Discrimination Protections

Lilly Ledbetter Fair Pay Act of 2009

• Essentially strips the statute of limitations with respect to compensation discrimination cases under Title VII, the Rehabilitation Act, the ADA, and the ADEA.

• Restarts the clock for an employee to file a claim with the EEOC every time an employee receives a paycheck “affected” by a discriminatory compensation decision, regardless of when it occurred.

• Employee must still file an administrative charge within 180/300 day window.

• Limits back-pay to two years prior to charge.

Signed into law in January 2009; retroactive to May 28, 2007. 

Paycheck Fairness Act

• Would amend the FLSA “to provide more effective remedies to victims of discrimination in the payment of wages on the basis of sex.”

• In effect, would require employers trying to rebut presumption of pay discrimination to establish that the factor responsible for the pay differential: “(i) is not based upon or derived from a sex-based differential in compensation; (ii) is job-related with respect to the position in question; and (iii) is consistent with business necessity.”

• The employee would still prevail if they show that there is an “alternative employment practice” that would serve the same purpose without producing the pay differential.

• Would change class certification scheme for pay-discrimination claims from opt-in (FLSA) to opt-out (Rule 23).

Passed the House in January 2009; was received in the Senate in January 2009, but has not gone to a vote. 

Employment Non-Discrimination Act

• Would provide federal protection (akin to protection afforded persons based on gender, race, religion, age, etc.) to persons because of their sexual orientation, gender identity, or both.

Inactive; reintroduction in the 111th Congress is anticipated. 

Equal Remedies Act

• Would remove the current caps on punitive damages under Title VII and the ADA.

Inactive; reintroduction in the 111th Congress is anticipated. 

B. Repositioning Work/Family Balance

Working Families Flexibility Act

• Would give employees the right to request flexible work options, including the number of hours the employee is required to work; the time the employee is required to work; and the location of the work.

• Within 14 days after employee requests change, employer would be required to meet with employee and then produce/deliver a written decision within 14 days after meeting.

• Employer’s decision must identify cost of change, overall financial resources involved, effect of change on employer’s business, etc.

• Upon denial, employee could request reconsideration, and employer would have to meet again and issue a final decision in writing, stating the grounds for denial. An employee could then file a complaint with the DOL.

• Penalties and damages would be available for infractions.

Reintroduced March 3, 2009; pending.

FMLA (possible expansions)

• Would allow employees to take leave to address effects of domestic violence; would provide employees up to 24 hours of unpaid leave per year to attend school activities or to take family members to doctor for regular medical or dental appointments.

• Another bill would require a Family Leave Insurance Program, into which employees and employers would pay shared premiums in order to fund paid FMLA leave for workers.

Introduced in 2007 and again in 2008; reintroduction in the 111th Congress is anticipated. 

Healthy Families Act

• In its current form, would require that employers provide 7 paid sick days to any employee who works more than 30 hours a week, with a prorated annual amount for employees working less than 30 hours; accrued sick leave could carry over from year to year.

Introduced in 2005 and again in 2007 with then-Senator Obama as a co-sponsor; reintroduction in the 111thCongress is anticipated. 

Family-Friendly Workplace Act

• Would amend the FLSA to allow private-sector employers to offer employees the option of receiving “comp time” PTO, rather than overtime premium payments, at a rate of 1.5 hours of PTO per “overtime” hour worked.  Employees would have to consent to the swap in writing.

• To be eligible, employees must have worked at least 1,000 hours in the prior 12 months; the maximum accrual is 160 hours of “comp time”; employers would have to pay out by January 31 of a given year all “comp time” not used in the prior year; and all “comp time” would have to be paid out at termination.

Introduced February 10, 2009; pending. 

C. Reinvigorating Unions

Employee Free Choice Act (EFCA)

• In its current form, would be the most sweeping revision to national labor law in over 50 years.

• Would allow unionization of a group of employees upon the union gathering signed cards from more than 50% of the members of that group, without the benefit of a secret ballot election; would require employers to submit to binding arbitration if they could not reach a first contract with the new union after 90 days of bargaining and 30 days of mediation (and such contract would be binding for 2 years); and would impose new, increased penalties for unfair labor practices.

Introduced in 2003 and again in 2007 with then-Senator Obama as a co-sponsor; reintroduced in both the House and Senate on March 10, 2009. 

Secret Ballot Protection Act

• This is the antithesis to EFCA and was, in fact, introduced before EFCA. It would require a secret ballot election and would preclude voluntary recognition of a union by an employer (something that is allowed currently).

Introduced February 25, 2009; pending. 

Re-Empowerment of Skilled and Professional Employees and Construction Tradeworkers (RESPECT) Act

• Would narrow the 60-year-old definition of “supervisor” under the NLRA to eliminate “assign” and “responsibility to direct” from that definition. Doing so would move thousands of front line and low-level supervisors within the protection of the NLRA and allow them to be forcibly included in unionized bargaining units.

Introduced in 2007; reintroduction in the 111th Congress is anticipated.

D. Executive Orders

Economy in Government Contracting

• Denies federal contractors reimbursement for funds spent on activities designed to persuade employees not to join a union.

Effective January 30, 2009. 

Notification of Employee Rights Under Federal Labor Laws

• Requires federal contracts (except purchases under $100,000) to require contractors to post a notice informing employees that they have a right to decide whether to join a union.

Effective January 30, 2009. 

Non-Displacement of Qualified Workers Under Service Contracts

• Requires all federal contracts (in excess of $100,000) to include a provision requiring any contractor who assumes the contract from a previous contractor to retain that previous contractor’s qualified employees.

Effective January 30, 2009. 

Use of Project Labor Agreements (PLAs) for Federal Construction Projects

• Allows the Government to require PLAs on large-scale federal construction projects (exceeding $25 million).  A PLA is defined as “a pre-hire collective bargaining agreement with one or more labor organizations that establishes the terms and conditions of employment for a specific construction project.”

Effective February 6, 2009. 

E. Other Putative Changes

Federal Oversight, Reform, and Enforcement of the WARN Act of 2007 (FOREWARN)

• Would amend the WARN Act by expanding scope of “employer” to businesses employing 50 or more full-time employees (rather than 100); expanding scope of “plant closing” from 50 employees down to 25; expanding “mass layoff” to 100 employees (rather than 500); and requiring 90 days advance notice (up from 60). It also would expand the scope of notice (employers would have to inform more people / entities of intended layoffs), and it would increase fines.

Introduced in September 2007; reintroduction in the 111th Congress is anticipated. 

Employee Misclassification Prevention Act

• Would step up enforcement regarding misclassification of independent contractors; increase penalties; and impose civil fines of $10,000 per violation for employers who “repeatedly or willfully” misclassify workers. Would also require employers to notify “non-employees” in writing of: (a) their classification; (b) the significance of the classification (that their rights to “wage, hour, and other labor protections” depend on proper classification); and (c) their right to contact the DOL if they need further information.

Introduced in House in May 2008 and in Senate in September 2008 with then-Senator Obama as a co‑sponsor; reintroduction in the 111th Congress is anticipated.

Dorsey & Whitney

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