NLRB greenlights employer rules requiring employee confidentiality during workplace investigations

On Tuesday, December 17, 2019, in Apogee Retail LLC d/b/a Unique Thrift Store, 368 NLRB No. 144 (2019), the National Labor Relations Board (the Board or NLRB) held that requiring employee confidentiality during workplace investigations does not constitute an unfair labor practice under the National Labor Relations Act (the Act or NLRA). This is yet another employer-friendly decision in a series of recent rulings overturning Obama-era Board precedent.

Back in 2015, the Board held that employers could require confidentiality during workplace investigations only where they demonstrated that confidentiality was necessary to preserve the integrity of the investigation. See Banner Estrella Med. Ctr., 362 NLRB 1108 (2015), enforcement denied on other grounds 851 F.3d 35 (D.C. Cir. 2017). This standard created a difficult situation for employers, placing the burden on them to determine if there was a need for confidentiality that outweighed any potential impact on workers’ NLRA rights. Moreover, the standard also conflicted with guidance from the Equal Employment Opportunity Commission (EEOC), which encourages employers to keep investigations confidential to protect victims and to encourage reporting.

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NLRB returns to past precedent in holding that employer’s duty to deduct union dues ceases when collective bargaining agreement expires

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.

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DOL final rule updates exclusions from employees’ regular rate

On December 16, 2019, the U.S. Department of Labor (DOL) published its first significant revision since 1968 to its interpretation of the calculation of the “regular rate” under the Fair Labor Standards Act (FLSA).[1] The regulations address whether certain fringe benefits must be included in calculating an employee’s regular rate for overtime purposes. With the publication of this final rule, the DOL seeks to not only provide clarity as to what is excluded from the regular rate, but also update regulations to better reflect the 21st-century workplace.

The DOL published a Notice of Proposed Rulemaking (NPRM) underlying the new regular rate rule on March 29, 2019. Comments to the proposed rule were submitted by small business owners, individual workers, unions, and professional associations. In response to those comments, the DOL made some modifications to the proposed rule before adopting it.

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Changes to the NLRB’s representation case procedures to go into effect in 2020

On December 13, 2019, the National Labor Relations Board (Board) announced a series of modifications to its representation case procedures. These modifications will be published on December 18, 2019, and are scheduled to go into effect on April 16, 2020. Unlike the Obama Board’s 2014 amendments, the current Board has elected to implement these changes without notice and comment.

According to the Board, “[w]hile retaining the essentials of existing representation case procedures, these amendments modify them to permit parties additional time to comply with various pre-election requirements instituted in 2015, to clarify and reinstate some procedures that better ensure the opportunity for litigation and resolution of unit scope and voter eligibility issues prior to an election, and to make several other changes the Board deems to be appropriate policy choices that better balance the interest in the expeditious processing of questions of representation with the efficient, fair, and accurate resolution of questions of representation.”

This announcement should come as a reprieve to employers after the Obama Board’s 2014 amendments, which imposed, among other things, tight procedural deadlines on employers and sped up the scheduling of elections thereby shortening the window employers had to conduct their own campaigns regarding unionization. The most notable changes are that now, elections will not normally be scheduled before the twentieth business day after the date of the direction of an election, disputes concerning unit scope and voter eligibility will normally be litigated at the pre-election hearing and resolved by the regional director before an election is directed, and employers will have a right to file post-hearing briefs.

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Tech industry watchdog challenges AI-driven recruiting practices

As technology continues to rapidly evolve, so do hiring and recruiting practices. A number of start-up companies have emerged in recent years offering employers the ability to use artificial intelligence (AI) to screen job candidates and determine their employability. These AI-driven recruiting practices, such as those that use facial and voice recognition technologies, are touted as a means of lowering recruiting costs and eliminating bias in the hiring process. But there is growing concern that the use of AI may threaten a job candidate’s privacy and might result in the inadvertent perpetuation of discriminatory hiring practices.

These concerns and others were raised in a recent complaint filed with the Federal Trade Commission (FTC), urging an investigation into one such company’s business practices. The complaint was filed by the Electronic Privacy Information Center (EPIC), a public interest watchdog located in Washington, D.C. EPIC’s complaint challenges the AI-driven recruiting solutions developed and sold by a company called HireVue, which currently has more than 700 corporate customers that use its technology as part of their hiring process. Continue Reading

New York state’s reproductive health law necessitates handbook revisions

New York state employers, it’s time to dust off and update your employee handbooks again.  Earlier this month, Governor Andrew Cuomo signed a law that protects employees against discrimination on the basis of their reproductive health decision-making. The law, which mirrors a recent bill passed by New York City lawmakers, also requires that employers in the state provide notice of the law in their employee handbooks/manuals.

Under the new law, employers are, effective immediately, prohibited from:

  • accessing personal information about an employee’s (or their dependents’) reproductive health decisions, unless the employer receives prior, informed, and written consent;
  • discriminating or taking retaliatory action against an employee on the basis of the employee’s (or their dependents’) reproductive health decision-making; or
  • requiring an employee to sign a waiver to deny them the right to make their own reproductive health decisions.

The law defines reproductive health decisions as including, but not limited to, the decision to use or access a particular drug, device, or medical service.

Perhaps most important in the near term, the law requires that all New York state employers that furnish an employee handbook/manual to their employees, add a new section to such handbook/manual that provides employees with notice of their rights and remedies under the new law. This requires every employer in the Empire state, therefore, to take immediate action. If you have any questions or concerns about the new amendment, or how it affects your company, Reed Smith’s experienced Labor & Employment Group is ready to speak with you. For more information regarding this law, please contact your Reed Smith attorney.

Pennsylvania wage rules: Changes on the horizon

Shortly after the U.S. Department of Labor’s new overtime rule was finalized, the Pennsylvania Department of Labor and Industry (L&I) followed suit and finalized its own proposed overtime rule. Regulation 12-106 was set to exceed the new federal rule regarding the minimum salary to be paid to employees who are exempt from overtime. The new federal threshold of $684 per week ($35,568 per year) goes into effect on January 1, 2020. Regulation 12-106 would have phased Pennsylvanians in executive, administrative, and professional roles into a new minimum salary requirement of $875 per week ($45,500 per year) by 2022. The threshold would have adjusted automatically every three years beginning in 2023.

The Independent Regulatory Review Commission was set to consider Regulation 12-206 yesterday, November 21, 2019. But about an hour before the meeting was to begin, the regulation was withdrawn. L&I advised in a brief letter that “legislation could be passed before the end of this year that would invalidate portions of this regulation.”

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California extends deadline to file employment claims from one year to three years

Beginning January 1, 2020, an individual’s deadline to exhaust their administrative remedies through advancing a charge of unlawful workplace discrimination, harassment, and retaliation with the California Department of Fair Housing and Employment (DFEH) will be extended from one year to three years.

Assembly Bill 9, known as the Stop Harassment and Reporting Extension (SHARE) Act, is a significant departure from California’s long-standing one-year statute of limitations and from the six-month statute of limitations period under federal law for claims made to the Employee Equal Opportunity Commission. In California, employment claims brought under the Fair Employment and Housing Act cannot be directly filed in court. Individuals must first exhaust their administrative remedies by filing a charge with the DFEH. Once the DFEH receives the charge, it can investigate the claim. If it determines that a violation of the FEHA has occurred, the DFEH may use its discretionary power to file a civil action on behalf of the aggrieved individual. If the DFEH is unable to determine whether a violation took place, or if an individual asks for an immediate right-to-sue letter (which is commonly the case, especially if the individual is represented by counsel), the DFEH closes its investigation and the individual has one year from the date of receipt of the right-to-sue letter to file a civil action against the employer. Continue Reading

The future is now: Employer use of present-day medical information to predict future disabilities does not violate the ADA

The sci-fi film Minority Report envisions the year 2054, when the U.S. government uses predictive foreknowledge of “precogs” to apprehend criminals before their crimes are ever committed, thereby reducing future harm. More than 15 years after the popular film was made, the Seventh Circuit’s decision in Shell v. Burlington Northern Santa Fe Railway Company arrives at a similar result. The Shell court held that employers do not violate the ADA when they use current predictors of future disabilities, such as obesity, to reject candidates for employment, thereby reducing future costs. This ground-breaking opinion opens the door for employer use of predictive tools such as genetic testing and AI algorithms to discern which applicants or employees are most likely to develop future (costly) disabilities, and exclude them from the workforce before disabilities arise, and before legally protected status attaches. In other words, the opinion allows employers to exclude someone based on a status of “likely to develop a future disability,” without violating the ADA, because the individual does not currently have the status of “disabled.”

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New data security law has broad implications for New York employers

On October 23, 2019, New York state’s Stop Hacks and Improve Electronic Data Security (SHIELD) Act went into effect. The law broadens the state’s existing breach notification laws and imposes new security obligations for companies doing business in New York, including an expanded focus on how companies handle biometric data. The SHIELD Act also applies to employee information, as long as there is at least one employee in New York state, regardless of the size or location of the company. As such, the law will have a significant impact on businesses across the country that have private information about consumers and employees based in New York.

For more information about the ramifications of the SHIELD Act, visit ReedSmith.com

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