If an employment relationship is to be terminated unilaterally, employers in Germany often find themselves between a rock and a hard place. The protection against Unfair Dismissal Act (Kündigungsschutzgesetz, KSchG), if applicable, sets high thresholds for validly terminating an employment relationship. Due to this, if a notice of termination is issued by the employer, employees in most cases file a claim for protection against unfair dismissal with German labour courts. As German labour courts can only decide whether an issued notice of termination is valid or invalid, a successful claim for protection against unfair dismissal means that the employee is reinstated into the employment relationship. In this case, the employee is generally entitled to backpay of the contractual compensation from the end of the notice period to the close of the court proceeding.

The financial risk for employers therefore increases with the length of the litigation. A typical proceeding in first instance takes between six to nine months and possibly longer. A subsequent proceeding in second instance can take additional six months or more. In some (luckily rare) instances legal proceedings can take several years. Depending on the salary of the employee in question, the financial exposure can easily reach six-figure amounts, not including the legal fees.

Continue Reading Between a rock and a hard place – not so much anymore?

In the dynamic arena of labor laws and regulations, New York City is once again leading the charge with proposed changes that could have profound workplace implications. On February 28, 2024, the New York City Council introduced a trio of bills aimed at significantly curtailing the use of noncompete agreements in the Big Apple. Though these bills are currently pending, and it remains to be seen whether they will ultimately be enacted, employers should nevertheless take note of the bills given that they are part of a broader movement to rein in noncompete agreements across the U.S.:

Continue Reading NYC legislators propose three bills to curtail noncompete agreements

California’s new law that creates a separate minimum wage applicable only to fast food restaurant employees took effect on April 1, 2024. Under Labor Code Section 1475 (LC 1475), this minimum wage is $20 per hour. It represents a significant increase from the current statewide minimum wage of $16 that went into effect at the beginning of the year. Many local jurisdictions within the state already have a minimum wage above $16 per hour, but none as high as $20 per hour. 

Continue Reading California’s new minimum wage for fast food restaurants took effect this month

Widely known as “Ban the Box” laws, California is among the many jurisdictions that have adopted laws limiting the use of criminal background checks in evaluating job candidates. Enacted in 2018, California’s Fair Chance Act generally prohibits employers, with five or more employees, from asking a job candidate about their conviction history before making a conditional job offer. Among other requirements, the Fair Chance Act also places an affirmative duty on employers to provide requisite notices to candidates and to evaluate several factors before withdrawing a job offer due to a candidate’s criminal history. Employers must also provide candidates with the opportunity to explain or provide mitigating information before making a final decision to rescind a job offer. In October 2023, California amended the Fair Chance Act to bolster these notice and evaluation requirements. The 2023 amendment also increased potential employer liability for failure to properly notify and evaluate a job candidate’s criminal history. Proposed legislation in California aims to place stringent requirements on when employers can request a criminal background check in the first instance and how the information obtained must be evaluated. 

Continue Reading Proposed California legislation may effectively ban criminal background checks

The French Supreme Court ruled on March 6, 2024 (n°22-11.016), that an employer cannot terminate an employee who has sent racist and xenophobic messages to a colleague via the professional email system,  if the messages were private.

Facts:

Due to an error made by one of the recipients of the emails, the employer became aware of the emails sent by the employee to his colleagues. The employee was dismissed for gross misconduct and challenged his dismissal by claiming that the employer has violated his private life as the emails were titled “personal and confidential”.

In return, the employer argued that, in accordance with the French Supreme Court’s rulings, a reason relating to an employee’s personal life can justify disciplinary dismissal if it constitutes a breach of an obligation arising from the employee’s employment contract.

Therefore, the employer claimed that the employee breached his employment contract’s obligations by sending racist and xenophobic emails via the professional email system.

The employer also argued that the employee abused the professional email system for personal purposes.

Continue Reading No disciplinary action for sending private racist messages via the professional email system

Paternity leave has not been forgotten in the swathe of family related legislative changes taking effect in April 2024. However, anyone hoping for significant changes will be disappointed. The changes are limited to improving flexibility for eligible employees wanting to take the existing right to two weeks of statutory paternity leave. There is no increase in the leave entitlement, or to the level of paternity pay.

The changes introduce the following flexibility:

  1. Allowing eligible employees to take their two weeks of statutory paternity leave in non-consecutive weeks (at present it must be taken in a block of one or two weeks).
  2. Allowing leave to be taken within the first 52 weeks after birth or adoption, rather than the first 56 days. However, employees wanting to also take shared parental leave will need to take their paternity leave early, as paternity leave cannot be taken after shared parental leave.
  3. Reducing the period of notice employees need to give their employer of their intention to take paternity leave to 28 days prior to each period of leave (reduced from 15 weeks before the baby is expected). There is no change to domestic adoption notice requirements which remain at 7 days.
  4. Simplifying the provisions for varying or cancelling statutory paternity leave by doing so on 28 days’ notice of the earlier of the original or new date.

These changes apply to eligible employees whose babies have an expected week of childbirth after 6 April 2024 or whose placement for adoption (or arrival in Great Britain if an overseas adoption) is on or after 6 April 2024.

In preparation for the changes applying from April 2024, employers should update their paternity leave policies and any template documents to reflect the changes.

While many employers enhance paternity leave over the statutory minimum there may nevertheless need to be changes to when the leave can be taken, or notice requirements, to ensure the policy is clear about how arrangements dovetail with the new statutory regime.

Managers should be informed and trained on the changes so that they are aware that they may get shorter notice of leave being taken. However, the enhanced flexibility about when and how statutory paternity leave is taken may also to be a benefit to employers.

On March 14, 2024, Virginia Governor Glenn Youngkin (R) vetoed identical bills passed by the Virginia legislature barring employers from asking about a job applicant’s salary history and requiring pay information to be included in job listings.

Senate Bill 370 and House Bill 990, introduced by Senator Jennifer Boysko (D) and Delegate Michelle Maldonado (D), respectively, add a new “salary history ban” statute to the Chapter of the Virginia Code that provides protections for employees. The legislation passed along party lines, with support from Democratic majorities in both the House and the Senate.

The proposed legislation prohibits prospective employers from (i) asking job applicants for their wage or salary history; (ii) relying on that history in determining the applicant’s starting wage or salary; (iii) considering wage or salary history when making a hiring determination; and (iv) refusing to interview, hire, employ, promote, or otherwise retaliate against an applicant for not providing wage or salary history. It also requires prospective employers to disclose the wage, salary, or wage or salary range for public and internal job postings. The legislation also creates a cause of action for aggrieved applicants and employees and provides for statutory damages between $1,000 and $10,000 or actual damages, whichever is greater, reasonable attorney’s fees and costs, and other appropriate relief.

Continue Reading Virginia governor vetoes “salary history ban” statute legislation

In October 2023, the National Labor Relations Board issued a final rule that lowered the standard for companies to qualify as joint employers. You can read more about the rule here.

On March 8, 2024, a federal judge in Texas struck down the final rule. U.S. District Judge J. Campbell Barker granted summary judgment in favor of the business coalition that challenged the 2023 rule. In short, the 2023 rule established a two-step test which requires: (1) the entity qualify as a common-law employer of the workers in question, and if so (2) the entity have control over one or more essential terms and conditions of employment. The court agreed with the business coalition’s contention that “the second test is always met if the first test is met, so the rule’s joint employer inquiry has just one step for all practical purposes.” The court found that “if an entity exercises or has the power to exercise control (even indirect control) over at least one essential term, the entity is an employer, jointly with workers’ undisputed employer.” And because such a result “would treat virtually every entity that contracts for labor as a joint employer,” the Board’s 2023 final rule “exceeds the bounds of the common law and is thus contrary to law.”

Continue Reading Texas judge vacates NLRB’s new joint employer rule

Employers in all industries should take notice that efforts to unionize appear to be spiking in 2024.  Indeed, data made available by the National Labor Relations Board (NLRB) shows that, in just the first few months of the current fiscal year, the number of union representation cases, or so-call “R-cases,” filed with the NLRB is on a meteoric rise – indicating that recent trends with respect to union organization efforts may be amplifying.

This was predicted in our prior article about the NLRB’s decision in Cemex Construction Materials Pacific, LLC, which established a new framework for the union representation process. Under Cemex, when a union requests recognition based on a majority support of the employees to be in the bargaining unit, an employer must either: (1) recognize and bargain with the union; or (2) promptly file a RM petition to challenge the union’s claim of majority support by seeking an election, pursuant to Section 9(c)(1)(B) of the NLRA, unless the union has already filed a petition for a representation election pursuant to Section 9(c)(1)(A) of the Act. The time for the employer to act is limited, as it is generally held that the employer has only 14 days after the demand for recognition in which to file an RM petition.

Continue Reading Employers take notice: Union representation petitions are spiking in 2024

The practice of fire and rehire has hit the headlines and been the topic of political debate in recent years. While the current UK government has rejected calls to outlaw entirely the practice, in early 2022 it committed to introducing a statutory code of practice to set out expected standards of behaviour and best practice.

Our blog from 13 February 2023 considered the draft code as the consultation was launched. We now provide an update on the content of the new Code and explores some challenges and tips for employers faced with navigating a change of terms and conditions once the Code comes into force, including the punitive sanctions for non-compliance, as well as a look ahead to what might change if we have a change to a Labour party government in the next 12 months.

Continue Reading Developments with the UK’s ‘fire and rehire’ clampdown: what’s next?