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On March 19, 2020, in an effort to slow the spread of COVID-19, Pennsylvania Governor Tom Wolf issued an order directing all non-life-sustaining businesses to close their physical locations effective March 19 at 8 p.m. The order provides a process for applying for a waiver, but, due to the high volume of waiver requests, enforcement was delayed until Monday, March 23, 2020, at 8 a.m.

Companies can check this list to see whether they are on the list of life-sustaining businesses, or they can email Department of Community and Economic Development (DCED) customer service at ra-dcedcs@pa.gov, or call 1-877-PA-HEALTH and select option 1 to reach DCED staff. Companies that are designated non-life-sustaining, but would like to seek a waiver, can apply via the online waiver application. Reed Smith attorneys are available to help you determine whether your company is designated life-sustaining or not and assist with the waiver process.

Q – What does it mean for my employees that my company is one that must shut down under Governor Wolf’s order?

A – It depends. The order does allow remote work, so if employees can work from home, they are permitted to do so. In the event your company cannot conduct operations remotely and must close, you may need to make some decisions about your workforce, including whether to furlough employees or lay them off. Under Pennsylvania unemployment compensation law, an eligible worker can collect unemployment benefits for a reduction in work, furlough, or layoff.Continue Reading Pennsylvania issues order closing all non-life sustaining businesses

On February 26, 2020, the National Labor Relations Board (NLRB) issued its final rule governing joint-employer status under the National Labor Relations Act (NLRA) in the federal register. The final rule will undo a more relaxed Obama-era joint-employer test by reinstating the joint-employer standard that the Board followed for several decades prior to its 2015 decision in Browning-Ferris Industries of California, Inc. According to the Board, its ruling provides “greater precision, clarity, and detail that rulemaking allows,” as to what constitutes a joint employer.

The Browning-Ferris decision held that a company could be deemed a joint employer if “its control over the essential terms and conditions of another business’s employees was merely indirect, limited and routine, or contractually reserved but never exercised.” However, with its final rule, the Board will reinstate a pre-Browning-Ferris test which holds that a business is only a joint employer if it “has substantial direct and immediate control” of one or more essential terms or condition of a worker’s job such that the business “meaningfully affects matters” pertaining to the employment relationship. In its ruling, the NLRB defined those “essential terms and conditions of employment” as “wages, benefits, hours of work, hiring, discharge, discipline, supervision, and direction.” It also defined “substantial” direct control as actions that have “a regular or continuous consequential effect” on one of the eight core aspects of a worker’s job that the Board listed, while pointing out that any direct control that is “sporadic, isolated, or de minimus” is insufficient to warrant a finding of joint employment.Continue Reading The NLRB offers “clarity” on its joint-employer test by issuing its final rule

In 2017, the City of Philadelphia enacted the Wage Equity Ordinance to address the pay gap between men and women and between different races and ethnicities. The Ordinance contains two provisions: the “Inquiry Provision,” which prohibits employers from asking about a prospective employee’s wage history; and the “Reliance Provision,” which prohibits an employer from relying on wage history at any point in the process of setting or negotiating a prospective employee’s wage. Mayor Jim Kenny signed the Ordinance into law in January 2017 after it was unanimously passed by Philadelphia City Council.

The Greater Philadelphia Chamber of Commerce, however, filed a lawsuit alleging that both provisions of the Wage Equity Ordinance infringed on the chamber and its members’ First Amendment freedom of speech rights. In the Chamber of Commerce for Greater Philadelphia v. City of Philadelphia et al., the Honorable Mitchell Goldberg from the Eastern District of Pennsylvania granted the chamber a preliminary injunction on the Inquiry Provision in April 2018, holding that the Ordinance violates employers’ freedom of speech rights. Judge Goldberg, however, upheld the Reliance Provision, which prohibits reliance on wage history, based on the court’s conclusion that such reliance did not implicate protected speech. In other words, Judge Goldberg found that an employer could ask about a candidate’s salary history, but could not use the information. Both parties appealed to the Third Circuit Court of Appeals.
Continue Reading Don’t Ask, Don’t Use – the Third Circuit allows the Philadelphia salary history ban ordinance to go into effect

On December 16, 2019, in Valley Hospital Medical Center, Inc. d/b/a Valley Hospital Medical Center (368 NLRB No. 139 (2019)), the National Labor Relations Board (NLRB) overturned its 2015 decision in Lincoln Lutheran of Racine (362 NLRB 1655 (2015)), restoring the Board’s 50+ year precedent established under Bethlehem Steel (136 NLRB 1500 (1962), that there is no independent statutory obligation to check off and pay employees’ union dues after the expiration of the collective bargaining agreement (CBA), even where the contract does not contain a union security provision. The decision is part of a trend of the current Board to reinstate legal standards that had stood for decades before being overturned during the Obama administration’s union-friendly Board.

In Valley Medical Center, the CBA between the employer and the union expired on December 31, 2016. The parties continued to operate under the expired contract, which contained a “check-off” provision that stated “the Check-Off Agreement and system heretofore entered into and established by the Employer and the Union for the check-off of Union dues by voluntary authorization … shall be continued in effect for the term of the Agreement.” The authorization form also stated that it was valid “during the term of the Agreement.” On February 1, 2018, almost 13 months after the expiration of the parties’ contract, and after providing 5 days’ notice and without providing the Union with an opportunity to bargain, the employer stopped deducting Union employees’ dues.Continue Reading NLRB returns to past precedent in holding that employer’s duty to deduct union dues ceases when collective bargaining agreement expires

On October 8, 2019, the Supreme Court will hear oral arguments in three landmark LGBTQ+ rights cases, which could broaden protections for the LGBTQ+ community by prohibiting employers from discriminating against employees based on their sexual orientation, transgender-status, or gender identity under federal law. Currently, conflicting federal cases and shifts in interpretation and policies at administrative agencies such as the Equal Employment Opportunity Commission and the Department of Justice have left employers without clear guidance on what is, or is not, protected at a federal level (separate and apart from state and local protections). In Altitude Express v. Zarda and Bostock v. Clayton County, Georgia, since consolidated, the Court will consider whether the prohibition on sex discrimination in Title VII of the Civil Rights Act of 1964 prohibits discrimination based on sexual orientation. In R.G. & G.R. Harris Funeral Homes v. EEOC, the Court will consider whether Title VII prohibits discrimination against transgender people. The cases are summarized below.

Altitude Express, Inc. v. Zarda / Bostock v. Clayton County, Georgia – factual background

Donald Zarda worked as a skydiving instructor for Altitude Express, Inc., responsible for taking clients on tandem skydives, strapped hip-to-hip and shoulder-to-shoulder to the client. In June 2010, while carrying out a tandem skydiving session with a young woman, Zarda stated he was gay in defense of a female client’s allegation that he touched her inappropriately. Altitude Express terminated Zarda’s employment on the grounds that he shared inappropriate information with clients regarding his personal life. After a three-judge panel ruled against Zarda, the Second Circuit, in an en banc decision, overturned the lower court, holding that discrimination based on sexual orientation violates Title VII.Continue Reading Supreme Court poised to hear oral arguments in blockbuster LGBTQ+ workplace discrimination cases

Today more than ever, U.S. businesses supplement their workforce with independent contractors as a solution to competitive and customer pressures. The use of contractors is entirely legal. But the correct classification of workers as contractors, as opposed to employees, is a complex analysis with frameworks that differ across a variety of governing laws. Employers, therefore, sometimes get this wrong. Recognizing the likelihood that workers are sometimes misclassified as contractors, on August 29, 2019, the National Labor Relations Board (the NLRB or Board) issued an important opinion for businesses when it held that misclassification of employees as contractors is not a violation of federal labor law.

NLRB pro-business opinion

Velox Express, Inc. is in the medical courier business. It supplements its driver workforce with independent contractors. Velox terminated its contract with one such driver, Jeannie Edge, when Edge began voicing concerns on behalf of herself and other drivers that Velox had misclassified them as contractors instead of employees. Edge filed an unfair labor practice charge claiming that the driver misclassifications violated the National Labor Relations Act (the Act). The administrative law judge agreed. In Velox Express, Inc. and Jeannie Edge, the Board, which has a three-member Republican majority, affirmed the judge’s ruling that Velox misclassified Edge and other drivers as independent contractors under the Act, but held that the misclassification, in and of itself, did not violate the Act. 368 NLRB No. 61.

Section 8(a)(1) of the Act provides that it is an unfair labor practice for an employer “to interfere with, restrain, or coerce employees” from exercising their legal right to engage in protected concerted activity under the Act. The Board explained that an employer’s mistaken classification of employees as independent contractors does not interfere with or threaten any workers’ right to engage in protected activity under the Act, even if independent contractors cannot join a union. Id. at 6. The Board’s rationale was that when workers are classified as independent contractors, they still retain the right to disagree with their classification and engage in protected activity, which is exactly what Edge did. The employer violates the Act only if it responds to the protected activities with threats, promises, and interrogations. Id. at 6. The Board held that “[e]rroneously communicating to workers that they are independent contractors does not, in and of itself, contain any threat of reprisal or force or promise of benefit.” Id.
Continue Reading On the eve of Labor Day, a win for business from the NLRB

The National Labor Relations Board (Board or NLRB) issued on Friday its first proposed regulation in a series that will overhaul parts of union election procedures. The Board’s 113-page proposed rule, which was published in the Federal Register today, Monday, August 12, modifies three of the board’s election processes: (1) the handling of blocking charges; (2) the voluntary recognition bar; and (3) certain collective bargaining relationships involving employers in the construction industry. This piecemeal approach is consistent with Board Chairman John Ring’s statements at the American Bar Association’s labor and employment conference last November and is part of the rule-making agenda the Board announced in May.

Under the Obama administration, the Board passed the “quickie” or “ambush” election rule, which significantly shortens the time between the date an election petition is filed with the NLRB and the date the election is held, requires preelection hearings to be held very shortly after the filing of a representation petition, and requires employers to provide union representatives with far more information on potential voters than in the past. These new procedures were derided by employers and business groups, which was most clearly evidenced in 2017 when the Board received over 7,000 responses to its invitation for comments on whether to roll back these changes.

In the Board’s Friday announcement, a three-member majority, over one Board member objection, said, “The board believes, subject to comments, that the proposed amendments will better protect employees’ statutory right of free choice on questions concerning representation by removing unnecessary barriers to the fair and expeditious resolution of such questions through the preferred means of a board-conducted secret ballot election.” Chairman Ring added, “There are few more important responsibilities entrusted to the NLRB than protecting the freedom of employees to choose, or refrain from choosing, a labor organization to represent them, including by ensuring fair and timely board-conducted secret ballot elections. We believe that the changes we propose today further the goal of protecting this vital freedom.” The Board’s lone Democrat, Lauren McFerran, objected to the proposed rule-making.
Continue Reading NLRB publishes proposed changes to union election procedures