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In July of this year, a Texas federal district court judge denied the state of Texas’ request to vacate the Equal Employment Opportunity Commission’s (EEOC) most recent guidance relating to gender identity discrimination. In doing so, the federal court held that the state could not bring the challenge in a previously filed lawsuit regarding prior EEOC guidance but, instead, must file a new lawsuit.

The state of Texas first took issue with the EEOC’s 2021 guidance, which required bathroom, dress code, and pronoun accommodations for employees based on gender identity. Texas filed suit against the EEOC in the United States District Court for the Northern District of Texas, requesting the court vacate the 2021 guidance (2021 Lawsuit). On October 1, 2022, the court vacated the 2021 guidance and issued a declaratory judgment that the guidance was unlawful on several grounds, holding that it: (1) was contrary to law because Title VII, even after the Supreme Court’s decision in Bostock v. Clayton County, does not require employers to provide accommodations regarding bathrooms, dress codes, or pronoun usage based on gender identity; and (2) unlawfully extended Bostock’s “non-discrimination holding” beyond statutory limits imposed by Congress. The EEOC did not appeal the district court’s judgment.Continue Reading Federal judge requires state of Texas to file new lawsuit to challenge recent EEOC guidance on gender identity discrimination

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

On October 26, 2023, the National Labor Relations Board issued a final rule that dramatically lowered the standard for companies to qualify as joint employers. You can read more about the rule here. In short, the new rule provides that even reserved, unexercised, or indirect control, such as through an intermediary, over one or more of the rule’s seven enumerated terms or conditions of employment is sufficient to establish joint employment. There is no doubt that implementation of the new rule will drastically expand when companies will be considered joint employers and create additional costs and obstacles for employers.Continue Reading Dueling challenges to NLRB’s new joint employer rule succeed in extending effective date of rule

On August 18, 2023, the Fifth Circuit sitting en banc in Hamilton v. Dallas County unwound its long-held limitation that an adverse employment action must be an “ultimate employment decision” to be actionable under Title VII. The majority reasoned that this limitation was incongruent with the broad language of Section 703(a)(1), which states that “[i]t…

On August 2, the National Labor Relations Board issued the Stericycle, Inc. decision, in which it reinstated a modified version of the Board’s pro-employee Lutheran-Heritage standard for scrutinizing employer workplace rules. Under this new standard, a rule or policy is “presumptively unlawful” if it tends to chill employees from engaging in protected conduct under Section…

On February 21, 2023, the National Labor Relations Board issued a landmark decision in McLaren Macomb that has the potential to seismically change how employers approach and manage employee separations that include severance packages. In response to this landmark decision and the impact it will have on many employers, Reed Smith’s Labor & Employment team…

Among a flurry of recent pro-union decisions, the National Labor Relations Board (Board) issued a decision on December 14, 2022 restoring an Obama-Era test for determining the appropriateness of a bargaining unit in representation proceedings. This recent decision is expected to give unions more power in determining the makeup of bargaining units and enable smaller…

Continuing a string of pro-union decisions, the National Labor Relations Board recently overruled a 2019 Board decision and held that employers violate federal law if they fail to transmit membership dues to unions after the expiration of a collective bargaining agreement.

In its 2019 decision in Valley Hospital Medical Center, Inc., 68 NLRB No.

One of the priorities of the current administration is to police the alleged abuse of “gig workers,” particularly through the Department of Labor and the National Labor Relations Board. The Federal Trade Commission (FTC) is now joining those agencies in the employee-protection business. The FTC recently announced it has initiated enforcement efforts to protect gig workers from alleged deception about pay, work hours, unfair contract terms, and anti-competitive practices.

According to the 17-page Policy Statement published by the FTC on September 15, 2022 (Statement), 16% of Americans report earning income through an online gig platform. Gig work has become commonplace in food delivery and transportation. As the FTC notes, gig work is expanding into healthcare, retail, and other sectors of the economy.

Three primary concerns for gig workers

The FTC’s Statement outlines three key concerns the FTC plans to address via the full weight of its legal and regulatory authority.

1. “Control without responsibility” – Most gig companies categorize gig workers as independent contractors instead of employees. “Yet in practice,” the FTC explains, “gig companies may tightly prescribe and control their workers’ tasks in ways that run counter to the promise of independence and an alternative to traditional jobs.” The FTC states that improperly classifying workers as independent contractors (instead of employees):

  • Deprives workers of essential rights, like overtime pay, health and safety protections, and the right to organize;
  • Burdens workers with undue risks such as unclear and unstable pay and requires they use their personal equipment (car, cell phone, etc.); and
  • Forces workers to cover business expenses commonly paid for by employers (insurance, gas, maintenance, etc.).

2. “Diminished bargaining power” – Gig workers are not given information about when work will be available, where they will have to perform it, or how they will be evaluated. Because of their lack of bargaining power and decentralized work environment, the FTC believes workers have little leverage to demand transparency from gig companies. Due to what the FTC characterizes as a “power imbalance”:

  • “[A]lgorithms may dictate core aspects of workers’ relationship with a” company’s platform, “leaving them with an invisible inscrutable boss.”
  • Workers are often forced to sign take-it-or-leave-it agreements with liquidated damages clauses, arbitration clauses, and class-action waivers.

3. “Concentrated markets” – Markets populated by gig companies are often concentrated among just a handful of businesses, resulting in reduced choice for workers, customers, and businesses. The FTC believes the resulting loss in competition may incentivize gig companies to suppress wages below competitive rates, reduce job quality, and impose onerous terms and conditions on gig workers.Continue Reading FTC set to begin policing companies for alleged gig worker abuse

Consistent with its pro-union agenda, the National Labor Relations Board recently reversed precedent established under the prior administration with respect to employer dress codes and the joint employer standard. Specifically, on August 29, 2022, the Board held that an employer’s dress code policies preventing employees from wearing pro-union apparel were unlawful. Furthering its agenda, on September 6, 2022, the Board released a new proposed joint employer standard, which would roll back the current standard established under the prior administration, making it much easier for companies to be deemed joint employers.Continue Reading NLRB reverses precedent on employer dress codes and joint employer standard