Labor and Employment Law Blog

Websites Must Be Accessible

By Ted Olsen

So you’ve been waiting for those website accessibility regulations promised by the Department of Justice almost FIVE YEARS ago? Wait no longer. The Department of Justice recently filed briefs indicating its position: If you are a “public accommodation” under the ADA or the Rehabilitation Act, and you have a website, all the information on the website must be accessible to all disabled Internet users. Read on.

DOL Says Employers Are Morons

By John Alan Doran

Okay, that’s not what the DOL said exactly. But the DOL did say today that companies far and wide are just wrong on which workers are employees and which are independent contractors for purposes of the FLSA. In an “Administrator’s Interpretation,” the DOL today re-asserted that it believes almost all individuals providing services to a company are employees and most companies who claim to be using independent contractors are simply misclassifying actual employees.

In what we only wish were a tongue-in-cheek commentary, the DOL’s own blog describes the Mis-“Interpretation” as an attempt to give employers “clarity” on employee status under the FLSA.  Unfortunately, the DOL Mis-“Interpretation” repeatedly chants the mantra that the FLSA defines “employee” in the broadest sense imaginable and then states a plethora of factors (all of which appear to suit the DOL and not job-creators) to be balanced in light of the FLSA’s definition. What clarity has the DOL provided when its stated position conflicts with the I.R.S. definition of “employee,” conflicts with laws in the majority of the states with respect to employee status, and repeatedly states that every classification requires an individualized balancing of multiple factors against an incompatible statutory definition?

WEBINAR – DOL Proposed Overtime Regulations

Sherman & Howard’s Labor & Employment Practice Group invites you to attend a complimentary webinar presented by Andy Volin and Doug Towns on Wednesday, July 29, 2015

On June 30, the U.S. Department of Labor released long awaited, new, proposed regulations for the overtime exemptions under the Fair Labor Standards Act for “white collar” employees. Under the proposed standards, employers may have to start paying overtime to many administrative employees who make less than $47,892 annually, even if they are “salaried.”

Click here for more information and to register!

Common Sense Trumps NLRB, For Once

By Patrick Scully

If the NLRB has a consistent adversary, it is common sense. And so, it was a bad sign for the NLRB when the District of Columbia Circuit Court of Appeals began its review of a recent NLRB Order with the following line: “Common sense sometimes matters in resolving legal disputes.” The NLRB had tried to strike down AT&T’s common sense prohibition against customer-facing employees wearing T-shirts with the word “Inmate” on the front and “Prisoner of AT$T” on the back. The NLRB found that the message on the shirts was protected and that AT&T’s prohibition was not saved by “special circumstances”. The NLRB contended that AT&T could show no actual customer fear or harm to customer relations, and that because AT&T had permitted employees to wear other “unprofessional” attire, it could not object to the “Inmate/Prisoner” shirts.

On review, the Court quickly dispatched the NLRB’s analysis, noting that the “special circumstances” exception includes “protecting the employer’s product” and “maintaining a certain employee image.” The Court explained that the Board itself recognized in the past that, if an employer reasonably believes that union apparel may harm the relationship with customers or an employer’s public image, the apparel may be lawfully prohibited. The Court found that one common sense question trumped the NLRB’s arguments: “What would you think about a company that permitted its technicians to wear such shirts when making home service calls?” Southern New England Telephone Company v. NLRB., No. 11-1099 (D.C. Cir. July 10, 2015).

Court Order Trumps Board

By Bill Wright

What happens when the NLRB says an arbitration agreement is illegal, but a court enforces the agreement anyway? Four plaintiffs recently found out. In Hobson et al. v. Murphy Oil USA, Inc., No. CV-10-S-1486-S (N. D. Ala. July 8, 2015), the plaintiffs brought a collective action, for themselves and others, seeking unpaid overtime. The employer raised the arbitration agreement, and the court ordered the plaintiffs to bring their individual claims in arbitration, effectively killing the plaintiffs’ attempt to bring the claims on behalf of other employees.

Instead of arbitrating, one of the plaintiffs filed an unfair labor practice charge with the NLRB, and the plaintiffs waited. And waited. Two and a half years they waited without ever starting the arbitration. Eventually, the NLRB ruled that the arbitration agreement illegally prohibited employees from engaging in protected, concerted activities, such as filing collective actions. (See our previous posts concerning DR Horton.) With the Board ruling in hand, the plaintiffs asked the court to reconsider its order on arbitration, but the court found the plaintiffs had failed to comply with its earlier order. The plaintiffs could have asked the court to stay the arbitration pending Board action, or they could have appealed the order, but instead, they just waited for over 2 years. Despite the Board’s ruling, the court called the plaintiffs’ behavior a “clear record of delay and willful misconduct” and dismissed the plaintiffs’ overtime claims as a sanction.

If you’re going to be in court, it is best to follow the court’s orders.

Another Mini-Dukes Action Revived

By Andy Volin

Current and former women employees of Wal-Mart recently won big in the Sixth Circuit in their mini-Dukes discrimination class action. The trial court had ruled that the class action was filed too late, but the court of appeal revived the claim. Phipps v. Wal-Mart Stores, Inc., No. 13-6194 (6th Cir. July 7, 2015). For those keeping score on these mini-Dukes cases, this decision reaches the same result as the Fifth Circuit considering the same issue.

The issue was when does the statute of limitations begin to run again, after stopping (also known as tolling) while a nationwide class action was pending. The plaintiffs had been part of the proposed nationwide class suing Wal-Mart in the Dukes case when the Supreme Court rejected the nationwide class. (Click here for details on Dukes.) These plaintiffs then brought suit with a class of women who worked only in Alabama, Arkansas, Georgia, Mississippi and Tennessee. The trial court ruled this new class claim was filed too late, relying on a prior Sixth Circuit decision about tolling. Shortly after the trial court’s decision, however, the Sixth Circuit, in another case, suggested that it might apply an exception. The trial court permitted the women to appeal its ruling immediately, leading to their recent appellate victory. Now the trial court will determine whether class action certification is appropriate.

This recent decision is just the latest in 15 years of litigation that multiple federal courts continue to pass around like a hot potato. After the Supreme Court rejected the nationwide class, the original Dukes case was restricted to just women who worked in California. That class has been de-certified, and Wal-Mart will surely try to duplicate that result in the Sixth Circuit.

Employment-ish FHA Decision

By John Alan Doran

Amid the headlines of last week’s Supreme Court decisions was one applying disparate impact analysis to claims under the Fair Housing Act “FHA”. Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc., No. 13-1371. (We report on these FHA cases because FHA concepts frequently overlap with employment discrimination law, and because we regularly handle FHA matters given this overlap.) A public interest group sued Texas under the FHA, arguing that Texas’ points system used to allocate federal tax credits to builders of low-income housing had a disparate impact by favoring construction of low-income housing units in predominantly black urban areas, thereby reinforcing segregated housing patterns. The Court unsurprisingly held that the FHA allows for disparate impact analysis. But, the Court added some useful language about the “business necessity” defense. For example, the Court recognizes that decisions challenged under disparate impact theory often involve a “mix of factors, both objective…and, at least to some extent, subjective….” The Court noted that disparate impact claims include a “robust causality requirement” that courts must “examine with care” at both the pleading and summary judgment stage, with an eye toward “prompt resolution” of these cases. These are some unexpected and extremely helpful words that should encourage employers and sway courts in future disparate impact cases.

DOL to Double Salary Test

By Bryan Stillwagon

The DOL released its long-awaited Notice of Proposed Rulemaking to update the salary requirements for the FLSA’s white collar exemptions (e.g., executive, administrative, and professional employees). Some highlights of the Proposed Rule:

  • Raise the standard salary level test from $455/week ($23,660 annually) to $970/week ($50,440 annually) (2016 figures)
  • Raise the salary requirement for Highly Compensated Employees from $100,000 to $122,148 annually
  • Automatic update the salary level requirements going forward
  • Revise the duties tests “to ensure that these tests fully reflect the purpose of the exemption”

Many employees currently classified as exempt from overtime are likely to lose the exemption because of the increased salary level test. The 295-page Notice, Fact Sheet, and additional resources can be found at http://www.dol.gov/whd/overtime/NPRM2015/.

Supremes Tell States Gay Marriage is Legal

By John Alan Doran

This morning, the U.S. Supreme Court struck down state laws the prohibit gay marriage in Obergfell v. Hodges, No. 14-556 (June 26, 2015), First, the Court held that the Fourteenth Amendment requires a State to license a marriage between two people of the same sex. Second, the Court held that the Fourteenth Amendment requires a State to recognize a same sex marriage licensed and performed in another State that does recognize that right.

The Court noted the many areas of life in the U.S. affected by marital status, such as taxation, hospital access, medical decision making authority, adoption rights and much more. But this is a labor and employment blog, so we focus on the effect on employers. First, as the Court recognized, the case will affect workers’ compensation laws in states that provide spousal benefits to spouses of workers’ compensation claimants, but do not recognize gay marriage. Second, the case may significantly affect employers in states that have mini-FMLA statutes with respect to leave to act as a caregiver for a spouse, but that do not recognize same sex marriage. Third, the case may affect employee health and life benefits with respect to spousal coverage depending on applicable state laws and the nature and language of each particular plan. Fourth, the case may affect spousal pension benefits to the extent that pension plans excluded same sex marriage from the definition of spouse. Employers should promptly revisit these affected areas and revise applicable policies, practices, and benefits accordingly.