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Following last year’s wave of new employment laws (previously covered as follows: Part 1, Part 2, and Part 3), Virginia has adopted a variety of new laws that will take effect July 1 and continue to transform the Commonwealth’s employment law landscape. Virginia employers should carefully review these new laws to ensure compliance in this changing environment and in light of newly expanded enforcement mechanisms.

Minimum wage increase

While Virginia adopted incremental increases to the minimum wage set to reach $15 per hour by 2026, the first step-increase was delayed due to the pandemic. Effective May 1, 2021, the minimum wage increased to $9.50 per hour and is set to increase again effective January 1, 2022.  The Virginia Department of Labor and Industry (DOLI) has issued a minimum wage guide for employers that includes an optional workplace posting announcing this increase.

The Virginia Overtime Wage Act

Governor Ralph Northam signed the Virginia Overtime Wage Act, which will take effect on July 1, 2021 and now provides overtime protections for employees under state law (previously overtime protections were only under federal law). While the new law incorporates the exemptions from overtime under the federal Fair Labor Standards Act (FLSA) and purports to graft the FLSA’s overtime protections into state law, there are several notable differences between the FLSA and Virginia’s new law.

Unlike the FLSA, Virginia’s new law (i) establishes a three-year statute of limitations thereby allowing recovery of up to three years of back wages, unlike the FLSA’s typical 2-year lookback; (ii) does not provide for any good faith defense for employers; and (iii) forecloses an employer from using the fluctuating workweek method or from paying a fixed amount to cover straight time wages for all hours worked. Accordingly, non-exempt employees paid a salary or on some other non-hourly basis are entitled to overtime for any hours worked over 40 at “one and one-half times” a regular rate of 1/40th of all wages paid for that workweek.  Also unlike the FLSA, the new law’s definition of “employer” includes derivative carriers within the meaning of the federal Railway Labor Act. Unlike prior Virginia law, the new law provides for a private right of action under Virginia’s wage payment statute (with enhanced remedies enacted last year).
Continue Reading Virginia adopts new laws effective July 1 that continue to transform the employment landscape

As we previously reported here and here, in January 2021 the U.S. Department of Labor (DOL) proposed a business-friendly final rule concerning the classification of workers as independent contractors under the Fair Labor Standards Act (FLSA).  The final rule, which was scheduled to take effect in March 2021 (but never did), reaffirmed the use of the so-called “economic reality test” to distinguish between independent contractors and employees under the federal wage/hour law.  In essence, the rule was intended to provide a more uniform approach to worker classification.

Shortly after taking office, however, President Biden postponed the effective date of the final rule and suggested it should be repealed.  The Biden administration has now followed through on that plan, with the DOL blocking the rule entirely earlier today.  In a press release announcing the rule’s withdrawal, the DOL stated: “Upon further review and consideration of the rule and having considered the public comments, the [DOL] does not believe that the Independent Contractor Rule is fully aligned with the FLSA’s text or purpose, or with decades of case law describing and applying the multifactor economic realities test.”…

Continue Reading Department of Labor withdraws pro-business independent contractor final rule

At a union event on Labor Day in 2020, President Biden vowed to be “the strongest labor president you have ever had.”  Although he has only been in office a short time, his administration is already taking steps to honor that pledge.  Specifically, on February 4, 2021, House and Senate Democrats introduced the Protecting the Right to Organize (PRO) Act.   The PRO Act previously passed the House in February 2020 and President Biden has committed to sign it into law if passed in this Congress.  If enacted, the PRO Act will fundamentally reshape the American workplace. …
Continue Reading Labor law under the Biden administration: A preview of the PRO Act

This week, the U.S. Department of Labor (DOL) proposed a new rule that would create a uniform approach to the way companies classify workers as independent contractors or employees under the Fair Labor Standards Act (FLSA). The notion of classifying workers as independent contractors versus employees has continued to gain importance in recent years, given the growing gig economy, which makes independent contractors central to the business models of many major companies.

The DOL’s newly proposed rule would greatly benefit companies, by making it easier to classify workers as independent contractors and thereby remove a company’s obligation to provide typical employee benefits and workplace protections, such as paid leave, overtime pay and other fringe benefits. This marks a large shift from the standard proposed under the Obama administration, which would have broadened the scope of employee status, but was ultimately nixed by the Trump administration in 2017. …
Continue Reading U.S. Department of Labor proposes new “reality” for classifying independent contractors

In another victory for employers and a further retreat from Obama-era policy, the National Labor Relations Board (“NLRB” or the “Board”) recently ruled that employers do not violate the National Labor Relations Act (“NLRA” or the “Act”) by maintaining a policy that allows employers to monitor employees on the job by searching employees’ personal property on company premises and/or company networks and devices.

In a June 24, 2020 decision – Verizon Wireless, 369 NLRB No. 108 (2020) – the NLRB reversed an Administrative Law Judge’s (“ALJ”) ruling that Verizon Wireless and its related entities’ (collectively, “Verizon”) policy permitting company searches of workers’ personal property violated Section 8(a)(1) of the Act by infringing upon employees’ rights to engage in concerted activity for mutual aid or protection under Section 7 of the Act.  The Board also upheld the ALJ’s ruling that another portion of Verizon’s policy permitting company monitoring of company computers and devices did not violate the Act.
Continue Reading NLRB greenlights company policy allowing searches of workers’ personal property on company premises and company devices and networks

Illinois officially has made it easier for certain workers who contract COVID-19 to claim it is an occupational disease for purposes of collecting workers’ compensation. On June 5, 2020, Illinois Governor J.B. Pritzker signed into law House Bill 2455, which amends the Illinois Workers’ Occupational Diseases Act (820 ILCS 310/et seq.) with respect to such claims.

In April 2020, the Illinois Workers’ Compensation Commission passed an emergency rule creating this same rebuttable presumption, but quickly withdrew the rule after it was challenged in court.

This amendment (codified as Public Act 0633) creates a rebuttable presumption that the exposure to and contraction of COVID-19 by a “COVID-19 first responder or front-line worker” arises out of and in the course of the employee’s employment, and is causally connected to the hazards or exposures of the employee’s employment.
Continue Reading It’s official: Illinois law presumes COVID-19 is a workplace injury for essential workers

On June 18, 2020, the U.S. Supreme Court issued a decision allowing the Deferred Action for Childhood Arrivals (DACA) program to continue operating. In so holding, the Court found the Department of Homeland Security (DHS) did not provide an adequate justification for terminating the DACA program and, thereby, violated the Administrative Procedure Act (APA).[1] But the Court’s decision does not resolve the matter entirely.

The Court did not rule on the legality of the DACA program itself. Instead, it merely repudiated the way DHS tried to rescind it. Although the Court held the DHS’s justification to terminate DACA was arbitrary and capricious, it recognized the DHS has the authority to rescind the program if it follows the required APA procedure. Thus, the DHS could try again to end the program by explaining more clearly its reasons for doing so.

Below, we answer two questions: (1) What is the status of the DACA program; and (2) What impact will the Court’s ruling have on DACA recipients and employers?…

Continue Reading Understanding the employment implications of the Supreme Court decision upholding DACA

The start of 2020 has already proven to be a busy year for employers in New Jersey. In addition to becoming the first state in the nation to mandate severance payments for mass layoffs, New Jersey has enacted some sweeping changes to its independent contractor laws.

Governor Phil Murphy recently signed five bills aimed at addressing misclassification of workers. These bills impose new requirements on companies, expand the scope of liability, and give the New Jersey Department of Labor and Workforce Development significant new authority.…

Continue Reading New Jersey enacts major changes on the independent contractor front

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