Employment & Labor (U.S.)

Beginning October 1, 2024, Maryland will require employers to disclose wage ranges and “other compensation” in job postings and upon the request of an applicant in an effort to promote greater wage transparency in the hiring process. The Maryland Wage Range Transparency Act amends the state’s existing law prohibiting employers from making salary history inquiries to now include these job posting wage transparency requirements. Maryland joins a growing number of states that have passed job posting pay disclosure requirements, including California, Colorado, Connecticut, the District of Columbia, Hawaii, Illinois, Minnesota, Nevada, New York, Rhode Island, and Washington.

Maryland’s new pay disclosure requirements apply both to external and internal job postings and cover any solicitation intended to recruit applicants for a specific available position. It also applies to any job posting for a job where work will be “physically performed at least in part” in Maryland but does not explain what “in part” means, leaving employers to guess if a single day or several months meets the test, or whether a remote worker who comes to periodic meetings in Maryland is covered. Continue Reading Maryland joins the growing list of states requiring pay disclosure in job postings

On July 25, 2024, the California Supreme Court ruled in the case of Castellanos v. State of California that Proposition 22, also known as App-Based Drivers as Contractors and Labor Policies Initiative, is constitutional. The statewide ballot measure from 2020 exempts certain app-based drivers from California’s independent contractor classification law. This decision will significantly impact ongoing gig economy litigation as well as potential future litigation.

In 2021, drivers for services including Uber Technologies Inc., Lyft Inc. and DoorDash Inc., joined with the Service Employees International Union and its California chapter to challenge Proposition 22. The drivers and union claimed that the voter-approved ballot measure passed in November 2020 must be struck down because it infringed on the California legislature’s power to set workers’ compensation laws. During the May 2024 oral arguments in San Francisco, the justices appeared skeptical of the drivers’ position, expressing concerns about the chilling effect on future ballot initiatives and questioning why the legislature simply could not create new workers’ compensation laws in response. The court concluded that Article XIV, section 4 of the California Constitution does not limit the ability of California voters to enact laws through the initiative process that touch on workers’ compensation, rendering Prop 22 constitutional.Continue Reading California Supreme Court upholds Prop 22: California gig drivers to remain contractors

As previously reported, in late April, the Federal Trade Commission (FTC) unveiled a final regulatory rule that would invalidate and ban virtually all preexisting and future non-compete agreements in the U.S. Simply put, the rule, if it takes effect – which is currently scheduled to occur on September 4, 2024 though, as noted below, that might not come to pass – would represent the largest seismic shift ever in U.S. non-compete law.

Following publication of the rule in the Federal Register in early May, legal challenges were promptly filed in Texas and Pennsylvania Federal Courts (another challenge was filed in Florida federal court in June). Motions seeking to preliminarily enjoin the final rule from taking effect then ensued, with the petitioners in each case arguing, among other things, that the FTC lacks authority to issue substantive rules concerning non-compete agreements and, also, that the FTC did not sufficiently tailor the rule to the purpose/justification underlying it (by issuing an essentially blanket ban on non-competes).Continue Reading Compete chaos: Pennsylvania Court blesses FTC non-compete ban just weeks after Texas Court strikes it down

As we previously reported, the U.S. Equal Employment Opportunity Commission’s (EEOC) final rule on the Pregnant Workers Fairness Act (PWFA) went into effect on June 18, 2024. The final rule provides guidance on how the EEOC will interpret and enforce the PWFA, including with respect to conditions that may qualify for accommodation, examples of what constitutes an accommodation, and clarification on the process through which employers and employees engage in the interactive process to obtain an accommodation.

Legal challenges to the final rule

The final rule has been the subject of several legal challenges. Recently, a U.S. District Judge in Louisiana issued a preliminary injunction that partially blocks the provision in the final rule requiring workplace accommodations for “purely elective abortions.” In the final rule, the EEOC takes the position that a person’s choice to have (or not have) an abortion qualifies as a medical condition that falls under the PWFA’s purview. The constitutionality of the final rule was challenged by the attorneys general of Louisiana and Mississippi, along with four religious organizations.Continue Reading EEOC’s final rule on the Pregnant Workers Fairness Act in flux

On July 1, 2024, the first phase of the U.S. Department of Labor (DOL)’s updated overtime rule went into effect, raising the minimum salary threshold for employees who are classified as “exempt” under the white-collar exemptions to the Fair Labor Standards Act (FLSA). The rule is subject to legal challenges but, as detailed below, remains in effect for now (other than for the State of Texas as a government employer).

A full summary of the rule is available here. In short, as of July 1, 2024, employees must be paid $844 per week ($43,888 annualized) to satisfy the salary threshold for the executive, administrative and professional exemptions. To satisfy the highly compensated” exemption salary threshold, employees must be compensated at least $132,964 per year (and a minimum of $844 per week). Effective January 1, 2025, the minimum salary threshold is set to increase to $1,128 per week ($58,656 annualized) for the executive, administrative, and professional exemptions, and to $151,164 per year for the highly compensated employee exemption. From there, the rule provides for updates to the minimum salary threshold every three years, starting July 1, 2027.Continue Reading Federal court challenges to DOL overtime rule yield mixed results while foretelling a merits ruling before end of year

On Tuesday, Governor Gavin Newsom signed Assembly Bill 2288 and its counterpart Senate Bill 92 into law, which amend California’s Private Attorneys General Act (PAGA). While the amendments are expansive in nature, eight major changes under this new version of PAGA are detailed below:Continue Reading California enacts eight noteworthy changes to controversial Private Attorneys General Act

“Under an amendment to the state labor law that took effect June 19, 2024, New York employers must now provide up to 30 minutes of paid lactation break time “each time such employee has reasonable need to express breast milk.” The amended law – which previously only required business to provide reasonable unpaid break time for such purpose – does not cap the amount of paid lactation breaks to which an employee is entitled and guidance issued by the New York State Department of Labor suggests that employees may be entitled to multiple paid lactation breaks in a given day, so long as the employee “reasonably need[s]” the break. Employers must also allow employees to use existing paid break or meal time for breast milk expression in excess of 30 minutes.Continue Reading Changes to New York employment law: Paid lactation breaks now in effect

The U.S. Supreme Court agreed to review a case on appeal from the Fourth Circuit involving the burden of proof required for an employer to show that an employee’s job position is exempt from overtime under the Fair Labor Standards Act (FLSA). The high court’s decision will have a notable impact on the ability of employers to defend misclassification claims brought under the FLSA.

While the Fifth, Sixth, Seventh, Ninth, Tenth, and Eleventh Circuits have applied the “preponderance of the evidence” standard, the Fourth Circuit has repeatedly applied the notably higher “clear and convincing” standard, including most recently in Carrera v. EMD Sales, 75 F.4th 345 (4th Cir. Jul. 27, 2023). The Court agreed to review the Fourth Circuit’s decision in Carrera to resolve this split among the federal circuits on the appropriate burden of proof for FLSA exemptions.Continue Reading U.S. Supreme Court agrees to resolve the split between the Circuits on the burden of proof for FLSA exemptions

On Monday, June 3, 2024, Attorney General Platkin and Director Sundeep Iyer of the New Jersey Division on Civil Rights (DCR) proposed a new rule (N.J.A.C. 13:16) that would clarify the legal standard and the burdens of proof for claims of disparate impact discrimination under the New Jersey Law Against Discrimination (LAD). 

The standard does not change the legal framework already applied by the courts in the employment context under the LAD, but this would resolve any question about the viability of a disparate impact claim and/or the framework to be applied.

Disparate impact discrimination occurs when a policy or practice that is neutral on its face has a disproportionately negative effect on members of a protected class. Such a policy is unlawful unless the policy or practice is “necessary to achieve a substantial, legitimate, non-discriminatory interest” and there is no “equally effective alternative that would achieve the same interest.”Continue Reading Attorney General and DCR proposes rule to clarify disparate impact discrimination under the New Jersey Law Against Discrimination

The New Jersey Supreme Court’s recent ruling in Savage v. Township of Neptune, places limits on the enforceability of non-disparagement clauses in settlement agreements. The court unanimously held that such clauses are unenforceable if they prevent employees from discussing details related to claims of discrimination, retaliation, or harassment, aligning with protections under the New Jersey Law Against Discrimination (LAD).

Christine Savage, a former police sergeant, filed a lawsuit in December 2013 against the Neptune Township Police Department, alleging sexual harassment, sex discrimination, and retaliation. The parties entered into a settlement agreement which included a non-disparagement clause. In 2016, Savage filed another lawsuit against the same defendants, claiming they continued their discriminatory and retaliatory conduct. This second lawsuit was settled in July 2020, also with a non-disparagement clause in which both parties agreed not to“make any statements … regarding the past behavior of the parties, which statements would tend to disparage or impugn the reputation of any party.”Continue Reading New Jersey Supreme Court limits use of non-disparagement provisions in New Jersey LAD settlements