Significant Developments in Employment Law

2017 saw a shake-up of changes in regulatory laws under the Trump Administration. Matthew Davison with Baker Donelson recently spoke at a Lunch & Learn regarding the new changes that have occurred.

Many changes include eliminating older regulations in exchange for new ones. Executive Order 13771 requires federal agencies to identify two existing regulations to repeal for each new regulation. Congress has also become more involved with monitoring and sometimes overruling new regulations. This shows the Trump Administration’s focus on fewer regulations on businesses. The administration also appears to be making decisions that are more pro-business and pro-employer.

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There are three main executive agencies in regard to employment law: The Department of Labor (DOL), National Labor Relations Board (NLRB), and the Equal Employment Opportunity Commission (EEOC).

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The Equal Employment Opportunity Commission is a bipartisan commission of five presidentially appointed members, although, right now, there are two vacant positions. Per Mr. Davison, the goal of the EEOC is “to ensure agency resources are targeted to prevent and remedy discriminatory practices where government enforcement is most likely to achieve broad and lasting impact.” This is achieved through their strategic plan, which according to Mr. Davison, includes:

  1. “Pay more attention to discrimination in federal government employment
  2. Focus on charges where there is systemic discrimination
  3. Emphasize non-monetary relief where only ‘reasonable cause’ is found
  4. Pursue litigation ‘responsibly’
  5. Improve its technology and social media presence
  6. Continue to provide outreach and technical assistance, especially to vulnerable communities (specifically including immigrants)
  7. Focus on its own employees and staffing”

Compared to prior years the EEOC seems to be overall more employer friendly. Notable course changes include suspending new EEO-1 requirements that would require businesses to report details including type of work and place the employees into wage bands. The EEOC continues to place priorities on ending age discrimination and protecting LGBTQ rights. In light of the #metoo movement there is also expected to be an increased focus on sexual harassment.

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The Department of Labor (DOL) is the department mainly in charge of wage and hour regulations. It played a key role in the Obama Administration but is currently facing budget cuts. Under the Trump Administration several rule rescissions have occurred. One regards the use of drug testing for unemployment; because the resolution was overturned it will allow states to determine if drug testing is a criteria for unemployment compensation. Another big rescission was of the Persuader Rule. The Persuader Rule stated that anytime an employer engaged a lawyer for advice or anti-union campaign guidance, the law firm had to report their fees to the NLRB. In July the DOL rescinded this rule.

In 2017 the DOL announced the withdrawal of two Administrative Interpretations regarding independent contractors and joint employers, both AIs were unfavorable to employers. The independent Contractor “test will no longer start with the presumption that all workers are employees”. This will give more decision making control to the employer. As for the Joint Employer, the DOL will likely return to requiring the employer to have direct control in regard to hiring/firing, compensation, and scheduling over the worker.

The DOL also made changes to the Overtime Rule, increasing the salary threshold for exemptions. However, states and business sued, saying that the DOL had overstepped its authority and the rule was overruled. In August of 2017 District Court ruled in favor of the businesses and states, stating that the DOL had in fact exceeded its authority. The Trump led DOL has abandoned any appeal of that decision and is expected to offer its own amendments to current overtime regulations.

NLRB

The third agency Mr. Davison discussed is the National Labor Relations Board, an agency created in 1935 with the purpose of administering the National Labor Relations Act. There are a few instances where a change of course from the NLRB is possible, the first being use of company email. In 2017 the NLRB affirmed its decision to require employers to allow all employees to use company email for collective bargaining and to engage in concerted activity. This could potentially be changed by the new board. Another possible change involves the many cases about confidentially, non-disclosure, and social media policies in employee handbooks. These policies could be considered an employer trying to suppress an employee’s right to concerted activity. The NLRB has sought to protect these rights.

Next, in the Columbia University case the NLRB ruled “students serving as teaching and research assistants at private universities were employees under the NLRA.” This decision is expected to be reversed. There have also been efforts to do away with the “Quickie Election” rule which shortened the time period for an election to be held. The final possible change regards class action waivers. Since 2012 the NLRB has consistently struck down arbitration agreements that prohibited employees from bringing class actions suits regarding their employment. This was considered a violation of Title XII. After a ruling by the Supreme Court and a change by the Trump DOJ, this is expected to change.

Two bills to watch in the near future are the National Right-to-Work Act and the Raise the Wage Act. The National Right-to-Work Act will “block employers and unions from including mandatory dues provisions in collective bargaining agreements in the 22 states where right-to-work is not already law.” The Raise the Wage Act was introduced by Democrats to raise minimum wage to $15 an hour. According to Mr. Davison this will probably not pass, but there will be some kind of change.

Mr. Davison noted the case of Villa v. CavaMezze Grill. The Plaintiff for this case was a low level manager for the defendant restaurant. She was told by a former employee that the former employee was sexually harassed by the Director of Operations of the restaurant. After an investigation the restaurant deemed the story untrue and fired the Plaintiff. Even though the Plaintiff only reported what she had been told, the court found she had not engaged in protected activity and ruled in favor of the defendant. This case is important because there has historically been an erosion of employer rights and this case ruled in favor of the employer.

Mr. Davison provided some very valuable information that can be used by companies and organizations large and small. Thank you to Matthew Davison and Baker Donelson for providing this information for our organization and local manufacturers.

Important notes:
The information above serves as a recap of the presentation provided by Matthew Davison of Baker Donelson, but was not written by Mr. Davison. All information and quotes were sourced from the presentation provided.

The full video of Mr. Davison’s presentation is available for members only here.

None of the advice or comments attributed to Matthew Davison or Baker Donelson should be relied upon as legal advice, nor was any advice or comments intended to be legal advice.

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