California Supreme Court rejects rounding time for meal breaks

On February 25, 2021, the California Supreme Court decided Donohue v. AMN Services, LLC^[1] (Donohue). In that case, the court held that (1) employers cannot round time in the meal period context and (2) time records showing noncompliant meal periods raise a rebuttable presumption of a meal period violation. Accordingly, the court’s decision has significant implications for employers who rely on time keeping systems that round time during employee meal breaks.

California’s meal period laws are governed primarily by California Labor Code section 512 and the Industrial Welfare Commission Wage Order No. 4. Pursuant to these regulations, an employee is entitled to a 30 minute meal break no later than the end of the fifth hour of work and another 30 minute meal break no later than the end of the tenth hour of work. An employer must provide the opportunity for a compliant meal period, but need not police it. If an employee voluntarily chooses not to take a meal break, then there is no meal period violation. However, if an employer fails to provide a compliant meal break and an employee does not voluntarily waive it, then the employer must provide that employee a premium pay, or one additional hour of pay at the employee’s regular rate of compensation for each workday a meal period is not provided. To avoid such penalties, an employer must provide its employees with complete and timely meal breaks whenever required by law. Continue Reading

IR35 changes – Are you ready?

By David Ashmore and Joanna D'Cruz on 26 February 2021 Posted in Employment (UK), Tax

With 6 April 2021 quickly approaching, the IR35 reforms are now back on the agenda and fast becoming a priority. Affected businesses need to have their implementation process in place before the IR35 reforms take effect.

IR35 is designed to ensure that appropriate income tax and national insurance contributions (NICs) are paid by contractors who provide their services through an intermediary company. In a nutshell, the IR35 rules bite where, but for that intermediary company, the individual contractor would be deemed an employee of the client. The IR35 reforms are important as they require medium and large businesses to carry out status determinations to assess whether IR35 applies. Where they conclude that IR35 applies (i.e. that there is deemed employment), the IR35 reforms shift responsibility to the client for making tax and NICs deductions through PAYE.

New Jersey legalizes recreational marijuana use: What this means for employers

By John T. McDonald, Saranne Weimer and Claire Throckmorton on 25 February 2021 Posted in Discrimination, Employment & Labor (U.S.), New Jersey Employment Beat, Workplace Laws and Regulations

On February 22, 2021, New Jersey Governor Phil Murphy signed the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (NJCREAMMA) and other related bills into law which legalize and regulate recreational cannabis use and possession for adults over the age of 21. With the enactment of NJCREAMMA, New Jersey now prohibits employers from discriminating against employees for off-duty recreational marijuana use (or decision not to use). These requirements are effective immediately.

Prior to the enactment of NJCREAMMA, New Jersey employers were prohibited from discriminating against individuals who are certified to use medical marijuana and required to engage in the interactive process with employees who request accommodations for medical marijuana use. NJCREAMMA extends the discrimination prohibitions to recreational marijuana users and prohibits employers from refusing to hire, discharging, or taking “any adverse action against an employee with respect to compensation, terms, conditions, or other privileges of employment because that person does or does not smoke, vape, aerosolize or otherwise use cannabis items.” In addition, these prohibitions extend to positive drug tests where solely cannabinoid metabolites are present in the employee’s system. Continue Reading

Brief refresher for California employers: 2021 updates to local COVID-19 paid sick leave requirements

By Michele Haydel Gehrke, Brittany Hernandez and Brandon Nhan on 23 February 2021 Posted in California Employment Beat, COVID-19/Novel coronavirus, Employment & Labor (U.S.), Workplace Laws and Regulations

The Families First Coronavirus Response Act (FFCRA), requiring employers with 50-500 employees^[1] to provide supplemental paid sick leave and paid family leave to their employees, and California’s statewide COVID-19 supplemental paid sick leave requirement expired on December 31, 2020. While employers may voluntarily continue to provide FFCRA and receive tax credits through March 31, 2021, the FFCRA mandates are now voluntary for employers to continue absent federal legislative action. Despite this, numerous California counties and cities have extended their COVID-19 paid sick leave ordinances and imposed additional requirements for employers. To date, these include: Los Angeles (City and County), City of Long Beach, Sacramento (City and County), San Francisco, City of Oakland, San Mateo County, Sonoma County, Santa Rosa, and San Jose.

City of Los Angeles. Los Angeles Mayor Eric Garcetti recently revised an order requiring an employer to provide COVID-19 Supplemental Paid Sick Leave (SPSL) if it has 500 or more employees in the city or 2,000 or more employees nationally. The February 10, 2021 revised order expanded coverage and provides SPSL benefits to employees employed with the same employer for 60 days, and expanded coverage to employees hired on or after March 5, 2020. Most importantly, the revised order mandates that employers calculate SPSL based on the employee’s respective two-week average pay over the last 60 days of employment. The order remains in effect until two calendar weeks after the expiration of the County of Los Angeles local emergency period. Continue Reading

Managing the risks of incentivizing COVID-19 vaccines for employees

By Michael Correll, Mark S. Goldstein, Corrie Buck and Amy Harwath on 7 February 2021 Posted in COVID-19/Novel coronavirus, Discrimination, Employment & Labor (U.S.), Wage and Hour, Workplace Laws and Regulations

The release of the COVID-19 vaccine came as welcome news for employers. With it, however, employers will now confront myriad new questions about how the vaccine will affect workplace terms and conditions. The foremost question across all sectors has been simple: Can and should employers mandate that their employees get vaccinated? While issuing a mandate may seem appealing, doing so creates a variety of both legal and practical risks that, for many businesses, may militate in favor of a voluntary compliance program.

Faced with this reality, many employers have begun exploring incentive-driven voluntary programs, including offering additional PTO, gift cards, and even cash “bonuses” to employees who provide proof of vaccination. While such a voluntary system avoids many of the pitfalls of a mandatory system, it also carries its own complexities and risks in an already complicated and unsettled area of law. This post examines some of those risks while also highlighting the unique uncertainty surrounding this emerging issue. Continue Reading

EEOC proposes new rules on permissible incentives for employer-sponsored wellness programs

By Michael Correll, Amanda Brown, Joseph J. Mammone Jr. and Jessyka Linton on 2 February 2021 Posted in Employment & Labor (U.S.), ERISA, Health Care, Workplace Laws and Regulations

On January 7, 2021, the EEOC proposed two rules, under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA), designed to clarify what incentives employers may offer employees and their family members for joining employer-sponsored wellness programs. In the 2017 case AARP v. EEOC, the then-existing regulations on employer-sponsored wellness programs were revoked. Since then, employers have lacked guidance on how to structure wellness programs without violating the requirements of both the ADA and GINA that individuals’ disclosures of health information be voluntary. The EEOC’s new rules seek to balance the competing interests. However, given the Biden Administration’s recently issued freeze on proposed rules that have not yet been enacted, employers should not act on the EEOC’s proposed rules yet.

Legal framework

Under the ADA, employers cannot require employees to disclose medical information that might enable employers to discriminate against them. Similarly, under GINA, the disclosure of the health information of a family member of an employee must also be voluntary. In 2016, the EEOC finalized rules that outlined how employers could incentivize employees and their family members to participate in wellness programs that required the disclosure of health information without violating the ADA or GINA. Under the 2016 rules, an employer could offer an incentive of up to 30 percent of the total cost of self-coverage without the wellness program running afoul of the ADA and GINA. However, in AARP v. EEOC, the United States District Court for the District of Columbia held that the EEOC had failed to provide a reasoned explanation for its 30 percent incentive limit, and as a result, the EEOC removed the incentive sections from the ADA and GINA regulations.

Virginia enacts first in nation permanent COVID-19 workplace safety standard

By Betty S.W. Graumlich, Mark Passero and Noah Oberlander on 1 February 2021 Posted in COVID-19/Novel coronavirus, Employment & Labor (U.S.), Virginia Employment Beat, Workplace Laws and Regulations

Virginia is the first state in the nation to enact a permanent workplace safety standard for COVID-19. This permanent COVID-19 standard became effective Wednesday, January 27, 2021 upon publication after review and approval earlier in January by Governor Ralph Northam and the Virginia Department of Labor and Industry’s (DOLI) Safety and Health Codes Board. While the permanent COVID-19 standard leaves in place the bulk of requirements contained in the previous temporary emergency COVID-19 workplace safety regulations, there are a number of key revisions of which employers should take note. Specifically, the permanent standard: Continue Reading

New York State provides supplemental guidance for its paid quarantine leave

By Mark S. Goldstein, Alexandra Manfredi and Leora Grushka on 26 January 2021 Posted in COVID-19/Novel coronavirus, Employment, Employment & Labor (U.S.), New York Employment Beat, Sick leave, US Alert, Workplace Laws and Regulations

As we previously reported, on March 18, 2020, New York State passed a law providing job protection and benefits to certain employees quarantined or isolated due to exposure to and/or infection with COVID-19. On January 20, the New York State Department of Labor issued supplemental guidance clarifying some important points for employers about complying with the leave’s requirements.

Since the Leave was enacted, a frequent question from employers has been whether employees are entitled to use the Leave multiple times – e.g., if they are subject to mandatory quarantine or isolation on more than one occasion. The guidance addresses this question by confirming that an employee shall not qualify for more than three quarantine/isolation orders. In other words, an employee will only be eligible to use the Leave three times. The guidance, however, does not specify whether this limitation applies on an annual basis.

Additionally, the guidance sets forth the following protocols for returning employees to work after completing a period of quarantine/isolation under the Leave:

Employees are not required to be tested for COVID-19 before returning to work (except for nursing home staff);
If an employee tests positive for COVID-19 after returning to work, they must not report to work;
If an employee continues to test positive for COVID-19 after finishing a period of quarantine/isolation, but before returning to work, they must not report to work; and
Employees meeting the criteria of scenarios two or three above will be deemed subject to a mandatory order of isolation and must be provided with the Leave, regardless of whether the employee already received such Leave. However, the employee must submit documentation from a medical provider or testing facility to attest that they tested positive for COVID-19 (except where the employer is the entity that conducted the test)

The guidance also states that employers that require an employee to remain out of work due to actual or potential exposure to COVID-19 (where the employee is not otherwise subject to a quarantine/isolation order) must continue paying the employee their regular rate of pay until the employee is permitted to return to work. If the employee subsequently becomes subject to an isolation/quarantine order, they will then be eligible for the benefits provided under the Leave.

Employers should ensure that they are aware of the job protections and benefits provided for by the Leave and should immediately ensure their compliance with its requirements, based on this new guidance. If you have any questions about your obligations under the Leave, Reed Smith’s experienced Labor & Employment Group is ready to speak with you.

DOL stops enforcing Executive Order 13950 on diversity training

By Michael Correll and Joseph J. Mammone Jr. on 25 January 2021 Posted in Discrimination, Employment & Labor (U.S.), Workplace Laws and Regulations

The Biden administration issued new guidance immediately following his Jan. 20 inauguration abrogating former U.S. President Trump’s Executive Order 13950 on Combating Race and Sex Stereotyping (the Order). Implementation of EO 13950 had previously been stayed by a preliminary nationwide injunction entered Dec. 22, 2020, in California federal court. As a result, federal contractors or organizations with a federal contract currently have no obligation to revise their diversity and equity training to omit the prohibited training topics set forth in EO 13950.

As previously discussed, EO 13950 sought to reshape the way government contractors performed diversity and equity training. It prohibited, among other things, restrictions on training about affirmative action, discussion of reparations and implicit bias, and guidance regarding limiting micro aggressions. Further, the Order mandated employer postings in the workplace as well as compliance communications with organized labor groups.

New York employers may be “exposed” to COVID-19 workers’ compensation claims

By Mark S. Goldstein and Leora Grushka on 22 January 2021 Posted in COVID-19/Novel coronavirus, Employment & Labor (U.S.), New York Employment Beat, Wage and Hour, Workplace Laws and Regulations

In September 2020, the New York Workers’ Compensation Board (WCB) issued guidance related to COVID-19 claims and their compensability under the State’s workers’ compensation laws. This guidance is especially noteworthy because workers’ compensation claims are expected to increase substantially as a result of COVID-19.

By way of background, New York is one of the few states that statutorily requires employers to obtain workers’ compensation insurance. This insurance provides benefits to workers who become ill or injured due to their employment, i.e. a work-related illness or injury. The recently-released guidance, therefore, is particularly significant because it states that Empire State employees who contract COVID-19 while working will generally be eligible for workers’ compensation benefits. Compensable claims entitle an employee to payment of an injured worker’s medical treatment for the work-related illness, wage replacement benefits if the illness prevents the employee from working, benefits to an employee’s surviving dependents in the event of death, and reimbursement of funeral expenses. Continue Reading