In an attempt to contain the continuing COVID-19 pandemic, President Biden issued two Executive Orders on September 9, 2021 that mandate COVID-19 vaccines for federal government employees and employees of federal government contractors. Although key details of these vaccine mandates have yet to be defined, the new measures appear to build on the administration’s recent mandate for vaccination or testing of contractor employees who work on-site at federal locations.  As a result of these new mandates, federal government contractors will soon be presented with complex and risk-laden decisions as employees seek exemptions, to the extent available, from the vaccine mandate. The Basics of the Executive Orders The first executive order is applicable to federal government employees, and requires the Safer Federal Workforce Task Force (Task Force) to issue guidance requiring a vaccine mandate for federal agency employees.  Federal agencies are then required to implement the Task Force’s guidance “with exceptions only as required by applicable law.”  The second executive order is applicable to federal government contractors, and provides that new government contracts and contract-like instruments must include a clause requiring the contractor and “any subcontractors (at any tier)” to comply with “all guidance” issued by the Task Force.  Pursuant to the terms of the contractor Executive Order, the clause’s requirements are applicable to “any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument.”  The Executive Order applicable to federal contractors provides that the Task Force will issue its guidance by September 24, 2021, and outline “definitions of relevant terms,” “explanations of protocols required of contractors and subcontractors,” and “any exceptions” to the vaccination mandate. What Types of Federal Contracts Trigger the Vaccine Mandate? The vaccine mandate is applicable to any contract or contract-like instrument that is entered into, extended, renewed, or has an option exercised on or after October 15, 2021. However, the Executive Order is effective immediately and agencies are “strongly encouraged, to the extent permitted by law” to extend the vaccine mandate to existing contracts not otherwise subject to the Executive Order.  The Executive Order adopts the definition of “contract or contract-like instrument” from the Department of Labor’s minimum wage regulations, and thus presumably excludes procurement contracts excluded from the Davis-Bacon Act and service contracts excluded from the Service Contract Act.  The Executive Order explicitly excludes federal grants, contracts with Indian Tribes, employees who perform work outside of the United States, contracts equal or less than the simplified acquisition threshold (generally $250,000), and subcontracts solely for the provision of products. Which Employees are Covered By the Mandate? The new contract clause will “apply to any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument.”  The “on or in connection with” standard is borrowed from the federal contractor minimum wage requirement.  Employees perform services “on” a contract when they perform the work required by the contract, and perform “in connection with” a federal contract when they perform services that are not required by the contract, but are necessary to the performance of the contract’s services, such as custodial, security, or maintenance services at facilities that perform both commercial and government work.  The executive order applies to “any workplace locations . . . in which an individual is working on or in connection” with a contract.  On its face, this would apply the vaccine mandate to full-time remote workers who do not interact in-person with any other co-workers. The Executive Order is ambiguous about several important issues, which will need to be fleshed out by the Task Force’s guidance.  First, in the context of the federal contractor minimum wage requirement, employees who work only “in connection with” a contact are not covered unless more than 20% of their work time is spent performing contract-related services.  Will the same 20% threshold apply to the vaccine mandate?  Second, the Executive Order is phrased to apply to “any workplace locations” where contract work is performed, rather than to employees performing the work.  Arguably, the mandate may cover workers performing only commercial work if there is also government contract work performed at the employee’s “workplace location,” which is itself a potentially ambiguous term pending further guidance from the Task Force. What Exemptions are Applicable? The Executive Order provides that the Task Force should permit only exceptions “required by applicable law.”  Presumably, this would include disability, religious, and pregnancy accommodations that are required by federal statutes. To date, many employers implementing vaccine mandates have struggled with these accommodation requirements, which present complex and nuanced legal issues.  To the extent the Task Force’s guidance regarding exemptions is different than generally-applicable federal law, it will only add to the complexity. Moreover, state law may impose different or additional requirements, including laws in some states protecting workers against mandatory vaccine mandates, which may conflict with the mandate required by the Executive Order.  To the extent there is ambiguity as to which employees are actually covered by the Executive Order, the potentially conflicting obligations under the Executive Order and state laws may pose challenging dilemmas for employers. COVID-19 vaccine mandates present complex legal issues for employers, especially when employees claim a right to religious, disability, pregnancy, or other accommodations. Federal contractors should begin working with counsel now to prepare for the new mandate required by the executive orders, including implementing procedures to communicate with employees regarding the mandate, ascertain employees’ vaccination statuses, and process and address requests for accommodations.

On September 9, 2021, President Biden unveiled a COVID-19 Action Plan that requires, among other things, millions of private-sector employees, health care workers, federal employees, and employees of federal contractors to be vaccinated against COVID-19. The announcement resulted in a political firestorm, leaving many employers wondering how new rules might affect both them and their employees. Announcement. President Biden mandated that employees working (1) within the executive branch of the federal government, (2) for employers with 100 or more employees, (3) at health care facilities that receive funds from the Medicare or Medicaid reimbursement program, and (4) for federal contractors, be vaccinated against COVID-19. Employers with over 100 employees are given the option to ensure their workforce is fully vaccinated or require testing on at least a weekly basis. Employers of over 100. President Biden charged the Occupational Safety and Health Administration (OSHA) with responsibility for issuing an emergency temporary standard related to businesses with 100 or more employees. Specifically what OSHA might order is yet to be seen, but mandatory vaccination or regular testing on at least a weekly basis, plus paid time off to get vaccinated and to recover from any side effects, will be included. Penalties of $14,000 per violation are also anticipated. There will likely be legal challenges regarding OSHA’s authority to issue such standards under current circumstances. To prevail, OSHA must prove that workers are exposed to a grave danger and the standards are necessary to address that danger. Any emergency standard must also be feasible for employers to enforce. Good news for employers seeking consistency may be that any OSHA standard would pre-empt existing rules by state and local governments, except in states with their own OSHA-approved workplace agencies (https://www.osha.gov/stateplans). Those states would have 30 days to adopt a standard that is (1) at least as effective as the OSHA standard, and (2) covers state and local government employees not covered by OSHA. Health care employees. President Biden’s Action Plan provides that the Centers for Medicare & Medicaid Services (CMS) will expand the vaccination requirement it issued for nursing home staff to other health care settings that receive Medicare and Medicaid reimbursement, including but not limited to hospitals, home-health agencies, ambulatory surgical settings, and dialysis centers. Education employees. The Department of Health and Human Services will require vaccinations in Head Start Programs, and schools run by the Department of Defense and Bureau of Indian Education, affecting about 300,000 employees. Federal employees. President Biden’s Action Plan requires all Federal employees to be vaccinated, with exceptions only as required by law (such exceptions include exemptions for employees with religious or medical reasons for avoiding vaccination). Federal employees who do not qualify for such exemptions but nonetheless refuse to be vaccinated will be counseled and disciplined, up to and including potential termination of employment. President Biden also signed an Executive Order directing that the Department of Defense, the Department of Veterans Affairs, the Indian Health Service, and the National Institute of Health extend this standard to employees of contractors that do business with the federal government. We anticipate OSHA to issue the emergency temporary standard and CMS to issue additional guidance related to President Biden’s Action Plan in the coming weeks. We will continue to provide updates as we learn more. If you have questions or would like more detailed information regarding these recent announcements, Polsinelli’s Labor & Employment team is here to assist.

In an attempt to contain the continuing COVID-19 pandemic, President Biden issued two Executive Orders on September 9, 2021 that mandate COVID-19 vaccines for federal government employees and employees of federal government contractors. Although key details of these vaccine mandates have yet to be defined, the new measures appear to build on the administration’s recent mandate for vaccination or testing of contractor employees who work on-site at federal locations.  As a result of these new mandates, federal government contractors will soon be presented with complex and risk-laden decisions as employees seek exemptions, to the extent available, from the vaccine mandate. The Basics of the Executive Orders The first executive order is applicable to federal government employees, and requires the Safer Federal Workforce Task Force (Task Force) to issue guidance requiring a vaccine mandate for federal agency employees.  Federal agencies are then required to implement the Task Force’s guidance “with exceptions only as required by applicable law.”  The second executive order is applicable to federal government contractors, and provides that new government contracts and contract-like instruments must include a clause requiring the contractor and “any subcontractors (at any tier)” to comply with “all guidance” issued by the Task Force.  Pursuant to the terms of the contractor Executive Order, the clause’s requirements are applicable to “any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument.”  The Executive Order applicable to federal contractors provides that the Task Force will issue its guidance by September 24, 2021, and outline “definitions of relevant terms,” “explanations of protocols required of contractors and subcontractors,” and “any exceptions” to the vaccination mandate. What Types of Federal Contracts Trigger the Vaccine Mandate? The vaccine mandate is applicable to any contract or contract-like instrument that is entered into, extended, renewed, or has an option exercised on or after October 15, 2021. However, the Executive Order is effective immediately and agencies are “strongly encouraged, to the extent permitted by law” to extend the vaccine mandate to existing contracts not otherwise subject to the Executive Order.  The Executive Order adopts the definition of “contract or contract-like instrument” from the Department of Labor’s minimum wage regulations, and thus presumably excludes procurement contracts excluded from the Davis-Bacon Act and service contracts excluded from the Service Contract Act.  The Executive Order explicitly excludes federal grants, contracts with Indian Tribes, employees who perform work outside of the United States, contracts equal or less than the simplified acquisition threshold (generally $250,000), and subcontracts solely for the provision of products. Which Employees are Covered By the Mandate? The new contract clause will “apply to any workplace locations (as specified by the Task Force Guidance) in which an individual is working on or in connection with a Federal Government contract or contract-like instrument.”  The “on or in connection with” standard is borrowed from the federal contractor minimum wage requirement.  Employees perform services “on” a contract when they perform the work required by the contract, and perform “in connection with” a federal contract when they perform services that are not required by the contract, but are necessary to the performance of the contract’s services, such as custodial, security, or maintenance services at facilities that perform both commercial and government work.  The executive order applies to “any workplace locations . . . in which an individual is working on or in connection” with a contract.  On its face, this would apply the vaccine mandate to full-time remote workers who do not interact in-person with any other co-workers. The Executive Order is ambiguous about several important issues, which will need to be fleshed out by the Task Force’s guidance.  First, in the context of the federal contractor minimum wage requirement, employees who work only “in connection with” a contact are not covered unless more than 20% of their work time is spent performing contract-related services.  Will the same 20% threshold apply to the vaccine mandate?  Second, the Executive Order is phrased to apply to “any workplace locations” where contract work is performed, rather than to employees performing the work.  Arguably, the mandate may cover workers performing only commercial work if there is also government contract work performed at the employee’s “workplace location,” which is itself a potentially ambiguous term pending further guidance from the Task Force. What Exemptions are Applicable? The Executive Order provides that the Task Force should permit only exceptions “required by applicable law.”  Presumably, this would include disability, religious, and pregnancy accommodations that are required by federal statutes. To date, many employers implementing vaccine mandates have struggled with these accommodation requirements, which present complex and nuanced legal issues.  To the extent the Task Force’s guidance regarding exemptions is different than generally-applicable federal law, it will only add to the complexity. Moreover, state law may impose different or additional requirements, including laws in some states protecting workers against mandatory vaccine mandates, which may conflict with the mandate required by the Executive Order.  To the extent there is ambiguity as to which employees are actually covered by the Executive Order, the potentially conflicting obligations under the Executive Order and state laws may pose challenging dilemmas for employers. COVID-19 vaccine mandates present complex legal issues for employers, especially when employees claim a right to religious, disability, pregnancy, or other accommodations. Federal contractors should begin working with counsel now to prepare for the new mandate required by the executive orders, including implementing procedures to communicate with employees regarding the mandate, ascertain employees’ vaccination statuses, and process and address requests for accommodations.

On September 1, 2021, the Office of Federal Contract Compliance Programs (OFCCP) announced that it would “evaluate” using compensation data reported by federal contractors in annual EEO-1 filings to guide its enforcement efforts in the area of pay equity.  This decision reverses a Trump-era decision that OFCCP would not request, accept, or use the data, and is a step towards the agency’s expected heightened enforcement activity in the area of pay equity. OFCCP’s reversal appears to be the next chapter in the protracted history of the Obama-era EEOC’s effort to collect compensation data from federal contractors and other employers through a new “Component 2” of the annual Employer Information Report, more commonly known as the EEO-1, submission. In September 2016, EEOC obtained approval from the Office of Management and Budget (OMB) to collect pay data for calendar years 2017 and 2018, but the Trump administration OMB later attempted to revoke the authorization.  The Trump OMB’s revocation was invalidated by the U.S. District Court for the District of Columbia, which ordered the EEOC to conduct the previously approved pay data collection.  However, in September 2019 the EEOC announced it would not seek renewal of OMB’s authorization for later years.  OFCCP followed with its own announcement on November 25, 2019 that it would not “request, accept, or use Component 2 data, as it does not expect to find significant utility in the data,” because the Component 2 data was not collected at a level of detail sufficient to make comparisons of similarly-situated employees. Now, OFCCP has reversed its position and announced that it will “evaluate the data’s utility because the joint collection and analysis of compensation data could improve OFCCP’s ability to efficiently and effectively investigate potential pay discrimination.”  OFCCP’s announcement also indicates that the agency may consider the Component 2 data “in conjunction with other available information, such as labor market survey data” in selecting contractors for compliance evaluations. OFCCP’s EEO-1 announcement appears to set the table for enhanced enforcement in the area of pay equity and compensation discrimination, as OFCCP is signaling it will use the EEO-1 pay data to select contractors for compliance evaluations.  Given the agency’s discontinuance of disability- and veteran-oriented focused reviews in favor of full compliance evaluations, OFCCP will be collecting employee-level compensation information in all of its compliance evaluations.  The announcement may also signal that OFCCP is coordinating with the EEOC on reinstating the Component 2 requirement, as the 2017 and 2018 data collected by EEOC would appear to have limited utility on a going forward basis.

Texas Governor Greg Abbott recently signed two new bills, effective September 1, 2021, which will arm employees with new tools and protections for asserting sexual harassment in the workplace claims. Here is what Texas employers need to know: The definition of an “employer” has expanded. Currently, an employer must have 15 or more employees to be covered by the Texas Labor Code’s anti-sexual harassment laws. As of September 1st, Senate Bill 45 (Tex. Lab. Code § 21.141), will define an “employer” as a person who (1) employs “one or more employees;” and (2) “acts directly in the interests of an employer in relation to an employee.” First, the new definition means that all employers, including those with only one employee, could be held liable for damages as a result of sexual harassment claims. Second, supervisors, managers, and co-workers may also be named as defendants in sexual harassment lawsuits and held personally liable for damages. This is a major change because it creates the potential for individual liability against the alleged harasser (which previously only arose within the employment context when there was a common law claim for assault). As a result, far more Texas employees are now able to sue for unaddressed sexual harassment than before, in state court, and removing cases to federal court will be more difficult. It is also conceivable that the plaintiff’s bar will attempt to argue that independent contractors, vendors, clients, and other third-parties may qualify as “employers” under this new statute. This underscores the importance of employer’s not only reviewing their own internal policies and procedures, but also their vendor and service agreements with contract partners. The definition of “sexual harassment” is more detailed. The new law provides a clear, detailed, description of prohibited behavior. Specifically, sexual harassment is defined as “an unwelcome sexual advance, a request for sexual favor, or any other verbal or physical conduct of a sexual nature if: (a) submission to the advance, request, or conduct is made a term or condition of an individual’s employment, either explicitly or implicitly; (b) submission to or rejection of the advance, request, or conduct by an individual is used as the basis for a decision affecting the individual’s employment; (c) the advance, request, or conduct has the purpose or effect of unreasonably interfering with an individual’s work performance; or (d) the advance, request, or conduct has the purpose or effect of creating an intimidating, hostile, or offensive working environment.” This definition gives employers further direction when analyzing employee behavior and investigating complaints. Employers must act quickly after receiving a complaint of sexual harassment. Employers should always take sexual harassment complaints seriously and investigate allegations immediately. However, in light of the recent #MeToo movement and influx of sexual harassment claims, Senate Bill 45 (Tex. Lab. Code § 21.142) appears to intensify the pressure on employers to look for concerning employee activity and act swiftly upon receipt of a sexual harassment complaint. The new law specifically provides that an unlawful employment practice occurs if an employee is subjected to sexual harassment and the “employer or employer’s agents or supervisors (1) know or should have known that the conduct constituting sexual harassment was occurring; and (2) fail to take immediate and appropriate corrective action.” Although immediate and appropriate corrective action is not defined, which makes it difficult to predict how the courts will interpret and apply the new language, employers should avoid any delays in addressing concerns and complaints. Employers often rely on the Faragher-Ellerth affirmative defense to defend their actions by establishing that the company took reasonable care to prevent harassing behavior and prompt corrective action when presented with complaints about a supervisor in federal court. This new Texas law appears to codify those expectations of employers and their agents in the workplace. Employees have more time to file charges of discrimination for sexual harassment. Historically, Texas employees who believe they have been subjected to unlawful employment practices (e.g., discrimination based on race, nationality, color, age, etc. or retaliation) have 180 days from the date of the alleged event to file a charge of discrimination with the Texas Workforce Commission. House Bill 21 (Tex. Lab. Code § 21.201(g)) extends that time to 300 days. The change in Texas is consistent with the broader national shift to expand protections against sexual harassment. In short, the speed and accuracy of investigations, as well as effective remedial measures, are more important than ever. Employers should also review their employee handbooks, policies, and procedures to ensure the language appropriately reflects the new laws. Polsinelli attorneys will continue to monitor further developments related to these amendments and provide updates. If you have any questions about the changes, including the potential impact on your company’s operations, contact your Polsinelli attorney.

On January 1, 2022, Public Act 102-0358, an amendment to the Illinois Freedom to Work Act will take effect and impact all non-compete agreements entered into prospectively. The law will ban employers from using non-compete agreements with employees earning less than $75,000 and from using non-solicitation agreements with employees earning less than $45,000. The law will not affect non-disclosure agreements entered with employees, regardless of income level. The law also requires an employer to provide a 14-day period to consider a non-compete or non-solicitation agreement and to advise the employee to consult with an attorney before entering into such an agreement. Illinois’ new law continues a recent trend limiting the scope of restrictive covenants, including, for example, at the federal level and in the District of Columbia. Employers should consult their Polsinelli attorney for assistance in reviewing and updating their template restrictive covenant agreements to ensure that after January 1, 2022 they enter enforceable agreements.

Walkouts by non-union employees have increased sharply over the past couple of years. “Walkout Wednesdays” have become a favorite organizing strategy for labor unions. Unions, like SEIU, make a significant investment of their resources to galvanize non-union employees’ support and participation in walkouts. The National Labor Relations Act provides protections to employees who engage in protests with coworkers related to their own working conditions, as well as actions taken to support employees of another employer. Workers at a fast-food company with locations worldwide have staged walkouts to have their employer work collaboratively with them to create a plan to stamp out sexual harassment. The Labor Board would likely find that the walkout was protected because the company had the ability to effectuate the change employees demanded: the employer can choose to work with employees to eliminate sexual harassment in its workplaces. Employee rights in this area are not unlimited, however. Employees who stage a walkout to support a political cause or other concern over which the employer has no control, may find that the Act does not protect them from discipline or discharge. Consider a walkout by employees to protest existing health disparities in a city—how non-whites in general and African Americans in particular are at higher risk for conditions like cardiovascular disease and diabetes—as well as access to healthcare disparities. Does the employer have the ability to affect solutions to these healthcare matters? In many situations, this issue is beyond the control of a single employer and employees who stage a walkout may well be outside the protection of federal labor law if they are disciplined or discharged for their participation in the walkout. Likewise, employees who are represented by a union may not have the right to engage in walkouts during working time. Many collective bargaining agreements prohibit employees from engaging in any work stoppage during the term of the agreement. But, if the CBA has expired, or it does not prohibit work stoppages, the unionized employees may have the same right to engage in a walkout as non-union employees. Employers are well-advised to work with experienced labor counsel to plan for, or respond to, walkouts, or other types of job action employees may take.

On July 29, 2021, the Biden Administration announced a COVID-19 vaccination mandate for certain employees of federal government contractors. The announcement, released in a Fact Sheet, imposes new safety protocols on the federal contractor workforce, but does not flesh out key details, including the specific responsibilities of federal contractors to obtain and ensure compliance. The Fact Sheet states that every “onsite” employee of a federal contractor “will be asked to attest to their COVID-19 vaccination status.” If an employee does not attest to being fully vaccinated, then that employee will be required to wear a mask on the job “no matter their geographic location,” physically distance from other employees and visitors, and comply with weekly or twice weekly screening testing requirements. Unvaccinated employees would also be subject to restrictions on official travel. The Fact Sheet also states that the administration is “directing” that “similar standards” be applied “to all federal contractors.” The Fact Sheet leaves many key questions unanswered, including: Who are the “onsite” contractor employees subject to the new mandate? Presumably the mandate applies to contractor employees who work on federal premises, but the Fact Sheet does not explicitly define this category. What obligations do federal contractors have to determine the vaccination status of their employees or conduct the required testing? What specific physical distancing protocols will unvaccinated employees be required to follow and who is responsible for ensuring compliance? Which agency will be issuing further requirements for “all federal contractors,” and under what statutory authority? Federal contractors, especially those whose employees work on federal premises, should begin immediately preparing to ensure their personnel comply with the new requirements. Contractors may wish to begin taking action to determine the vaccination status of their workforces and encourage employees to obtain a COVID-19 vaccination. Because vaccination issues are rapidly developing and involve complex determinations under the Americans with Disabilities Act, Genetic Information Non-Discrimination Act, and other federal and state laws, contractors should consult with counsel about these requirements. Polsinelli will continue to update the contractor community as additional details are announced.

On Monday, July 26, 2021, a group of nearly 60 major medical organizations, including the American Medical Association, American Nursing Association, American Pharmacists Association, American College of Physicians, American College of Preventative Medicine, and American Public Health Association advocated for all health care and long-term care employers to require their employees to be vaccinated against COVID-19. This joint statement, comes in the wake of the recent surge in “highly contagious variants, including the Delta variant, and significant numbers of unvaccinated people, COVID-19 cases, hospitalizations and deaths” in the United States. The joint statement also stressed the ethical obligations for health care workers, “[Vaccination] is the logical fulfillment of the ethical commitment of all health care workers to put patients as well as residents of long-term care facilities first and take all steps necessary to ensure their health and well-being.” In recent weeks, an increasing number of hospitals and health care systems have announced COVID-19 vaccination requirements for their employees. On July 21, 2021, the American Hospital Association released a statement urging all health care workers to be fully vaccinated. The statementencourages health care systems to take certain steps to facilitate an orderly roll out of any mandatory policy, including: Providing exemptions to the policy for medical reasons and accommodations (e.g., a sincerely held religious belief); Following relevant CDC guidelines, OSHA requirements, and other applicable state or federal law and/or guidelines regarding the use of personal protective equipment and other infection control practices for unvaccinated workers who have been granted an exemption or accommodation; Implementing the policy in compliance with applicable local and state laws; Following CDC and FDA guidelines on how to determine which workers are eligible and should be prioritized for vaccination; Monitoring data relating to FDA authorized or approved vaccines that are being distributed; Providing workers with information about the efficacy and safety of the COVID-19 vaccine in an effort to encourage voluntary vaccinations; and Offering flexibility in workers’ schedules to permit time for workers to receive the vaccine and recover from potential side effects. Also announced on Monday, the Department of Veterans Affairs became the first federal agency to mandate all 115,000 of its frontline health care workers who work in Veterans Health Administration facilities, visit VHA facilities, or provide direct care to those VA serves—including physicians, dentists, podiatrists, optometrists, registered nurses, physician assistants, expanded-function dental auxiliaries, and chiropractors—to be vaccinated against COVID-19. Each employee will have eight (8) weeks to be fully vaccinated.

On July 26, 2021, California Governor Gavin Newsom announced that California state workers, workers in health care, and workers in high-risk congregate setting will be required to provide proof of Covid-19 vaccination or undergo weekly testing and wear appropriate PPE.  The publication issued by the Governor’s office, which is not considered a “mandate” (yet) has been published as a “measure” to encourage State Employees and Health Care workers to get vaccinated.  The measure applies to public and private facilities. The new directive will apply to three large groups of employees. First, the measure will apply to California state employees. The new policy for state workers will take effect August 2. The measure provides that testing will be “phased in over the next few weeks.” Second, the measure will apply to employees working at high-risk congregate settings. By way of example (but not limitation) the measure identifies adult and senior residential facilities, homeless shelters, and jails as “high-risk congregate settings.” Employees working at these locations will be subject to the measure beginning August 9. Third, the measure will apply to “health care workers.” Of note, the publication from the Governor separately references “health care workers” and employees at “health care facilities.”  This suggests that health care workers who work outside of health care facilities would be subject to the measure. Unfortunately, Governor Newsom’s directive does not define the term “health care workers.” In previous orders, California’s Public Health Office designated the Health Care and Public Health Sector as a “large, diverse, and open [sector], spanning both the public and private sectors.” (https://covid19.ca.gov/essential-workforce/). In its definition of “health care providers” it included the following:   physicians, dentists, psychologists, mid-level practitioners, nurses, assistants, and aids; infection control and quality assurance personnel; pharmacists; physical, respiratory, speech and occupational therapists and assistants; social workers and providers serving individuals with disabilities including developmental disabilities; optometrists; speech pathologists; chiropractors; diagnostic and therapeutic technicians; and radiology technologists. (https://covid19.ca.gov/essential-workforce/ - (1) Health Care/Public Health – Essential Workforce, Paragraph 1.)  This group of professionals will likely be considered “health care workers” for purpose of the measure.  Additionally, all employees working at health care facilities will likely be subject to the measure as well. California’s Public Health Office also includes within its Health Care and Public Health sector employees working in emergency medical services, inpatient and outpatient care workers, home care workers, and residential and community-based providers. (https://covid19.ca.gov/essential-workforce/ - (1) Health Care/Public Health – Essential Workforce, Paragraph 2.) Of note, while these employees are considered part of the Health Care and Public Health sector, they are not listed under the heading for “health care providers.”  As a result, it is unclear, at this time, whether this latter sect of employees, that do not work at health care facilities, as well as other type of employees listed within the Health Care and Public Health sector, will be considered “health care workers” for purpose of the measure. Employers of health care workers and congregate facilities will be required to follow the measure effective August 9.  Additionally, health care facilities will have until August 23 to come into full compliance. For a full copy of Governor’s Newsom’s statement please click here . Polsinelli attorneys will continue to provide updates, should and when further guidance is published.

On July 21, 2021, the Department of Labor issued a Notice of Proposed Rulemaking to implement President Biden’s Executive Order 14026 increasing the minimum wage for certain employees of federal government contractors and subcontractors to $15.00 per hour. As expected, the proposed regulations are generally consistent with the regulations previously issued by the Obama administration in 2014 to implement President Obama’s increase in the federal contractor minimum wage. Under the proposed regulations, the minimum wage for workers performing services on or in connection with a federal contract will increase to $15.00 per hour as of January 22, 2022, with inflation-based adjustments on January 1 of 2023 and each successive year. The increased minimum wage applies to contracts that are entered, renewed, or extended (including extensions through the government’s exercise of an option) after January 30, 2022. The regulations provide contractors with a short grace period, however, as contracts entered into between January 30, 2022 and March 30, 2022 that result from pre-January 30, 2022 solicitations are not covered by the regulations until the contract is renewed or extended. The regulations include a minimum wage of $10.50 per hour for tipped employees, but the ability to take a tip credit will phase out on January 1, 2024, after which point tipped employees will be entitled to the same minimum wage as other covered employees. Notable exclusions from the increased minimum wage include federal grants, contracts with Indian Tribes, procurement contracts excluded from the Davis-Bacon Act, service contracts excluded from the Service Contract Act, contracts that are not performed in the United States, and contracts for manufacturing or furnishing materials, supplies, articles, or equipment to the federal government. As in the previous regulations, employees perform services “on” a federal contract when they directly perform the services called for by the contract, which should be a relatively straightforward determination. Employees perform services “in connection with” a federal contract when they perform services that are not required by the contract, but are necessary to the performance of the contract’s services. Common examples of services “in connection with” a contract include custodial, security, or maintenance services at facilities that perform work on federal contracts. Workers who only perform “in connection with” a federal contract are not subject to the minimum wage requirement if they perform less than 20% of their work time on performing services “in connection with” the contract. Both prime contractors and subcontractors of any tier are covered by the higher minimum wage. The regulations do not create a private right of action for employees to sue contractors for unpaid wages, but instead provide for the Department of Labor’s Wage and Hour Division to investigate complaints of violations. Employers are prohibited from retaliating against employees who make such complaints. Possible sanctions for failing to pay the increased minimum wage include withholding of contract payments from the prime contractor, the termination of contracts, and debarment from federal contracting.

On the one year anniversary of the Supreme Court’s decision in Bostock v. Clayton County, the EEOC has issued new guidance to clarify whether employers can segregate workplace restrooms by gender or sex. While not law, this guidance instructs employers how the EEOC will handle sex discrimination charges under its purview. In Bostock, the Court held that the “because of sex” language in Title VII extends protections to sexual orientation and transgender status. However, in the majority opinion, Justice Gorsuch made clear that the Court was not taking a position on the use of “private spaces” and left unresolved the question of whether employers could segregate restrooms by gender or sex. The EEOC’s guidance seeks to clarify confusion stemming from the Bostock decision. The new guidance directs employers that they must allow employees to use the bathroom, locker room, and/or shower that corresponds with their gender identity. Employers may not use anxiety, confusion, or discomfort on behalf of other coworkers as grounds to justify discriminatory policies. If an employer has unisex or single-use facilities, then the individuals can continue to use those as they currently do.  The EEOC has also created a consolidated webpage for resources addressing sexual orientation and gender identity. Interestingly, the guidance was not issued by the full Commission. Rather, the guidance was issued by the Chair of the EEOC and is considered non-binding guidance at the moment. However, employers should expect that the guidance will likely become binding in July 2022 when President Biden will be able to nominate a Democrat to the Commission, thus tilting the ideological majority of the Commission. The new majority may even expand upon Chair Burrows’ guidance. Employers should consult their Polsinelli attorneys for assistance in interpreting and implementing the EEOC guidance.

On July 9, 2021, President Biden made good on a campaign promise to address non-compete agreements by issuing a sweeping executive order that specifically targets barriers to competition. Specifically, the executive order encourages the Federal Trade Commission and other federal agencies to ban or limit non-compete agreements. However, no specifics are offered as to the breadth of any restrictions the Biden Administration would ultimately like to see. And even assuming those agencies respond to this encouragement, we expect the rulemaking process will not yield actionable results for a considerable period of time and is unlikely to result in a complete ban on the use of non-competes. In a press conference, the President stated that the executive order is in response to the growing number of employers utilizing non-competes in recent years – estimating that between 35 million and 60 million private-sector individuals are subject to non-competition agreements. The Biden Administration believes limiting or banning the use of non-competition agreements will increase economic growth and increase wages to allow workers mobility to switch to better-paying jobs. The executive order could prove to be an accelerant for states to initiate their own legislation limiting the use of non-competes – a recent state-law trend that has been gaining traction across the country, in which we have been closely monitoring over the last few years. Regardless of how broadly the executive order is written or when federal agencies ultimately issue new rules, the writing on the wall for years has indicated that the broad use of traditional non-compete agreements will continue to be limited. Employers would be wise to revisit the protections they have in place to protect trade secret and confidential information and their investments in employee training to ensure such protections are narrowly tailored to obtain court enforcement if challenged. One solution has been to move away from traditional non-compete agreements toward customer-based restrictions for the majority of employees. Polsinelli attorneys continue to monitor actions taken by federal agencies to enforce President Biden’s executive order and are prepared to assist employers with navigating the evolving non-compete landscape.

As California moved forward with reopening most of its economy on June 15, 2021, many employers in the state were left wondering whether and when the California Division of Occupational Safety and Health (“Cal/OSHA”), the state agency tasked with regulating workplaces to protect public health and safety, would update its regulations to conform to the latest guidance from the Centers for Disease Control and Prevention (“CDC”) and the California Department of Public Health (“CDPH”) for vaccinated individuals.  Although Cal/OSHA had previously voted to adopt proposed revisions to the COVID-19 emergency temporary standards (“ETS”) which had been in effect since November 30, 2020, Cal/OSHA subsequently voted to withdraw the proposed revisions and offered to make further revisions in light of updated CDPH face covering guidance and other concerns raised by Board members. Relief finally arrived on June 17, 2021, in the form of revised Cal/OSHA regulations that track the state’s latest COVID-19 public health guidance and instruct California employers regarding rapidly changing state policies on requiring masks, proof of vaccination, and physical distancing in the workplace.  Following the Cal/OSHA Board’s adoption of the revised regulations, Governor Newsom issued an executive order allowing them to take effect immediately on June 17. Among the regulations’ biggest changes are the removal of physical distancing and physical partitioning requirements in the workplace, regardless of employees’ vaccinations status, with certain limited exceptions for COVID-19 outbreaks. In addition to greatly limiting physical distancing and physical partitioning requirements in the workplace, the revised ETS do away with face covering requirements for all employees working outdoors, regardless of vaccination status, with certain exceptions for outbreaks.  Fully vaccinated employees no longer need to wear face coverings indoors, with certain exceptions for public transit, classrooms, health care and long-term care settings, correctional and detention facilities, and homeless shelters.  Vaccinated employees who wish to go mask-less in the workplace must document their vaccination status in one of two ways: (1) by either providing proof of vaccination to their employer; or (2) by self-attesting to their vaccination status.  Employers are required to record the vaccination status of any employee not wearing a face covering indoors and must keep these records confidential. Face coverings continue to be required indoors and in vehicles for unvaccinated employees, and employers are now required, upon request, to provide unvaccinated employees with approved respirators for voluntary use when those employees are working indoors or in a vehicle with others.  When there is a major outbreak of COVID-19 in the workplace, employers must offer respirators to employees regardless of vaccination status and without waiting for a request from the employee.  Employers must also offer COVID-19 testing at no cost to any symptomatic, unvaccinated employees, regardless of whether there is a known exposure to COVID-19, in addition to unvaccinated employees after an exposure, vaccinated employees after an exposure if they develop symptoms, unvaccinated employees in an outbreak, and all employees in a major outbreak. Polsinelli attorneys will continue to monitor state and federal COVID-19 relief efforts and remain prepared to assist employers with navigating these evolving issues.

On July 1, 2021, OFCCP issued its Corporate Scheduling Announcement List (CSAL) scheduling 750 federal contractor and subcontractor establishments for compliance evaluations in fiscal year 2021.  The CSAL identifies contractors and subcontractors that will receive a Scheduling Letter formally initiating an OFCCP audit.  Scheduling Letters are typically issued about 45 days after the CSAL’s publication. The FY2021 CSAL is limited to supply and service contractors, and does not include construction contractors, whose audits will presumably be scheduled pursuant to a separate announcement.  With OFCCP’s elimination of focused reviews and compliance checks earlier this year, significantly fewer contractors will be subject to OFCCP audits in fiscal year 2021 than in recent years.  Overall, the FY2021 CSAL schedules 668 contractor establishment for establishment-based reviews, 57 for functional affirmative action plan (FAAP) reviews, 19 for corporate management compliance evaluations (CMCE) focused on the contractor’s headquarters, and six (6) for university reviews.  In prior years, OFCCP has identified over 2,000 contractors for audits. The CSAL’s publication provides contractors with a valuable opportunity to prepare for the upcoming audit.  OFCCP’s Scheduling Letter requests over 22 categories of data and documents, including full employee-level compensation data, with a relatively short timeframe for response.  Contractors named in the CSAL can begin working immediately, in advance of receipt of the Scheduling Letter, to collect and analyze the requested data and documents in order to identify and, if possible, resolve any potential compliance vulnerabilities before they become more significant issues in the audit process. By identifying potential compliance vulnerabilities now prior to the issuance of a Scheduling Letter, contractors can ensure they are not caught flat-footed by OFCCP allegations arising from the contractor’s initial submission of documents and data.  Although contractors should take this opportunity to ensure that all aspects of their OFCCP compliance are in order, we anticipate that pay equity and gender pay gaps as well as potential race or gender based disparities in reductions in force undertaken during the COVID-19 pandemic will be areas of focus for OFCCP.

With so much of the workforce going remote this past year, there has been a huge shift in the way many people view pet ownership. In fact, the national pet adoption rate jumped more than 30% at the beginning of the pandemic, and animal rescue organizations reported an overall increase in adoptions of 30 – 50% in 2020. Not only has the spread of remote work helped match pets to homes, but we know that animals have been shown to reduce stress and provide much needed comfort and social support to many workers during the pandemic. The shift to work-from-home has also opened our doors to our colleagues’ pets, whether meeting them on Zoom or hearing them interrupt conference calls. This has made it seem more normal to have your pet – or your colleagues’ pets – around during the work day. With the potential for going back to the office seemingly closer, some offices are considering whether to go pet-friendly. Here are a few steps to consider before your office makes this decision: Consider Your Workforce and your Workplace Not every office will be the right place for pets, but it could be a perk your employees really appreciate (and could make it easier for employees to come back into the office). Consider if the office space allows for pets to stay in their own areas, out of the way of those who do not feel comfortable with animals around. Think about how easy your employees can take pets outside, or remove them from distracting other employees. Finally, take account of employee pet allergies, and determine what limitations would need to be in place. Require Authorization There should be a process for employees to receive authorization to bring their pet to work, and provide necessary information regarding their pet’s health and vaccine history. Any employee bringing a pet to work must agree to observe certain requirements or risk losing their pet-privileges. Establish Guidelines Employers need to determine what types of pets can come to work (e.g., dogs, cats, fish, etc.), and designate certain areas pet-friendly, and certain areas off-limits for animals. Strict cleaning guidelines should be in place to ensure the workplace remains clean and safe for all. There are also legal concerns when addressing pets at work. Beyond a full pet-friendly policy, employers must remember that pets may need to be allowed as a reasonable accommodation for employees with disabilities. The Americans with Disabilities Act (ADA) requires service animals be allowed in all areas of public access, and employers are required to engage in the interactive process with employees if a pet may be an appropriate accommodation for a disability. The ADA generally requires service animals be allowed in an employer setting, if doing so will not create an undue hardship for the business. This is not the case for emotional support animals, however, which are not necessarily trained for a specific service, but simply to provide comfort and companionship. Either way, when faced with the question, employers should consider whether a pet would be an appropriate accommodation that enables an employee to perform the essential functions of his or her job. For assistance with an office checklist, authorization forms, or general guidance, contact your Polsinelli attorney.

Over the weekend, the U.S. Southern District of Texas issued an order that provides employers—at least in Texas—with greater certainty about the legality of mandatory vaccination policies. In December 2020, the EEOC issued interim guidance that suggested employers may mandate COVID-19 vaccines (subject to reasonable accommodation and sincerely held religious belief considerations). Replying on the EEOC’s guidance, a Houston hospital implemented a mandatory COVID-19 vaccination policy earlier this year. This policy was met with resistance and more than 100 current and former employees joined in a lawsuit against the hospital, seeking to enjoin the enforcement of the policy, arguing that refusal to comply would equate to wrongful termination under various public policy causes of action. Central to the plaintiffs’ lawsuit, they argued that any such mandatory vaccination policy amounted to unlawful coercion (i.e., the threat of termination) for refusal to take an “experimental” vaccine that has only been approved under the FDA’s emergency use authorization. The Court rejected this argument and dismissed the case. The Court concluded that there was nothing illegal or against public policy about receiving the COVID-19 vaccine. While the Court stressed that vaccine safety and efficacy were not considered in adjudicating this case, it also acknowledged that the employer’s mandatory vaccination policy would, in its judgment, provide a safer work environment for employees and patients. Importantly, the Court also emphasized that a private employer’s mandatory vaccination policy does not amount to coercion: “[an employee] can freely choose to accept or refuse a COVID-19 vaccine; however if she refuses, she will simply need to work somewhere else.” While this case serves as an important bellwether, it’s application could be limited—particularly in other states that provide for more expansive public policy claims. The claim chiefly relied on by the Texas plaintiffs is extremely narrow in application and generally only applies in instances where an employee is terminated for the refusal to perform an illegal act that carries criminal penalties. In short, while the legal analysis could differ in other states, employers can now cite at least one legal opinion that has endorsed the use of mandatory vaccination policies. Polsinelli attorneys will continue to monitor COVID-related employment litigation and provide updates. If you have questions about this decision, contact your Polsinelli attorney.

On May 28, 2021, the Equal Employment Opportunity Commission (“EEOC”) provided long-awaited clarification on an employer’s ability to offer incentives to their employees for receiving COVID-19 vaccinations.  This new guidance provides welcomed direction to those businesses looking to encourage workers to get vaccinated rather than adopting a mandatory vaccine policy.  A summary of the EEOC’s guidance on vaccine incentives, as well as other new updates to the EEOC’s previous vaccine-related guidance, is provided below. Vaccine Incentives The EEOC identifies the following options for employers to offer their workers incentives for vaccination under the Americans with Disabilities Act (“ADA”): Employers can offer incentives to employees to voluntarily provide documentation or other confirmation of vaccination received from an independent third party (e.g., pharmacy, personal health care provider or public clinic).  However, any information or documentation collected should be maintained confidentially under the ADA. Employers can also offer incentives to employees for voluntarily receiving a vaccine administered by the employer or its agent, so long as the incentive is “not so substantial as to be coercive.”  Although the EEOC does not go so far as to define “substantial,” it explains that “a very large incentive could make employees feel pressured to disclose protected medical information” when responding to the employer’s pre-vaccination medical screening questions. Although employers can offer an employee’s family member an opportunity to be vaccinated if certain conditions are satisfied, employers cannot require family members to be vaccinated and should not offer employees incentives for family member vaccination. Confidential Medical Information In its updated guidance, the EEOC instructs that the ADA requires an employer to maintain the confidentiality of employee medical information, including documentation or other confirmation of COVID-19 vaccination, regardless of where the employee gets vaccinated.  Accordingly, while employers can require employees provide proof of vaccination (i.e., doing so is not a “disability-related inquiry”), this information must be maintained confidentially and separate and apart from the employee’s personnel file. Reasonable Accommodations The EEOC reiterated that if an employee cannot get vaccinated because of a disability or religious belief, the employer cannot require compliance with a mandatory vaccine policy unless it can demonstrate that the individual would pose a “direct threat” to the health and safety of the employee or others in the workplace.  This determination should be based on consideration of four factors previously-identified by the EEOC, and “should be based on a reasonable medical judgment that relies on the most current medical knowledge about COVID-19,” including the level of community spread, statements from the CDC and/or statements from the employee’s health care provider.  The employer must also take into account the employee’s specific work environment. If the employer determines that the individual would pose a direct threat, it must then consider whether a reasonable accommodation would reduce or eliminate that threat, unless doing so would present an “undue hardship” to the employer.  The EEOC provides specific examples of potential accommodations, including wearing a face mask, social distancing, working a modified shift, making changes in the work environment (e.g., increasing ventilation, limiting contact with others), teleworking, or, as a last resort, reassigning to a vacant position in a different workspace. Finally, the EEOC cautions that employers should consider all options before denying an accommodation request, and that the “undue hardship” consideration may be impacted by the vaccination rate of the workforce and the extent of employee contact with non-employees (whose vaccination status may be unknown). Pregnancy The EEOC’s guidance also clarifies that employees who are not vaccinated because of a pregnancy may also be entitled to certain accommodations under Title VII if the employer makes modifications or exceptions for other employees “who are similar in their ability or inability to work.” These modifications may be the same as the accommodations identified above for employees based on a disability or religious belief. Emergency Use Authorization The EEOC declined to offer any insight on the legal implications of the Emergency Use Authorization for the three available COVID-19 vaccines to date, indicating that “[t]he EEOC’s jurisdiction is limited to the federal EEO laws . . . .”  The EEOC reinforced, however, that federal EEO laws do not prevent an employer from requiring employees to be vaccinated as a condition of entering the workplace, subject to the reasonable accommodation requirements under Title VII and the ADA (and other EEO considerations discussed in its guidance). Updated CDC Mask Guidance The EEOC acknowledged the recently updated guidance from the CDC exempting fully vaccinated individuals from masking requirements, and indicated that the EEOC is considering the impact of this CDC guidance on the EEOC’s own COVID-19 guidance provided to date.  Accordingly, we may see further updates to the EEOC’s technical assistance soon.  For Polsinelli’s own guidance on responding to the CDC’s updated mask guidance, see here. Polsinelli attorneys will continue to monitor and report on any updated guidance from the EEOC and are available to answer questions about vaccine policies and related incentives.

Over the last several months, vaccination rates in the United States increased, COVID-19 cases decreased, and guidance from the Centers from Disease Control and Prevention (the “CDC”) regarding fully vaccinated individuals left employers wondering whether loosened COVID-19 face mask requirements were appropriate. While some state and local leaders took the leap and loosened face mask requirements, the CDC’s guidance still advised that fully vaccinated employees should be required to wear a mask, socially distance, and adhere to other mitigation strategies in the workplace even if they were around other fully vaccinated employees. Yesterday, May 13, 2021, much of the nation celebrated news that the CDC had “changed its tune” and face masks were simply no longer required if an individual is fully vaccinated. But is that what the CDC really said? The Guidance While the news headlines, social media posts, and radio snippets will simply communicate that “fully vaccinated people no longer need to wear a mask or physically distance in any setting” the latest guidance for fully vaccinated individuals actually provides: ·         Fully vaccinated people can resume activities without wearing a mask or physically distancing, except where required by federal, state, local, tribal, or territorial laws, rules, and regulations, including local business and workplace guidance. This distinction is important because EVEN if the CDC says it is okay not to wear a mask, employers CAN still require it. But should they? State/Local Laws While some states and municipalities have already loosened COVID-19 face mask requirements, others remain in place (though changes are likely to come in the next few days). If an employer opts to loosen their COVID-19 face mask requirement, they should ensure that the state/municipality where their workplace is located has no COVID-19 face mask requirements in place that would prohibit their less restrictive policies. What about OSHA? The Occupational Safety and Health Agency (“OSHA”) Protecting Workers: Guidance on Mitigating and Preventing the Spread of COVID-19 in the Workplace still provides that employers should not distinguish between workers who are vaccinated and those who are not vaccinated when implementing and enforcing COVID-19 safety policies. While OSHA’s guidance may change in the near future, employers should be aware that OSHA’s position remains that employees “who are vaccinated must continue to follow protective measures, such as wearing a face covering and remaining physically distant.” Importantly, following an Executive Order signed by President Joe Biden on January 21 directing OSHA to consider an Emergency Temporary Standard (“ETS”) related to COVID-19, OSHA submitted a draft of an ETS related to COVID-19 to the White House Office of Information and Regulatory Affairs. The ETS will likely be issued soon and may very well implicate the use of face masks in the workplace. Enforcement If an employer is going to loosen COVID-19 safety policies based on the vaccination status of its employees, it becomes absolutely essential to know whether an employee is actually fully vaccinated. While the Equal Employment Opportunity Commission (“EEOC”) has determined that inquiring as to whether or not an employee is vaccinated and/or asking for proof of vaccination is not a disability-related inquiry, follow-up questions or voluntary explanations from an employee may trigger an employer’s liability under the Americans with Disabilities Act (“ADA”) or Title VII. Thus, employers considering whether to loosen their face mask requirements should work with legal counsel to determine the best way to verify whether or not an employee is fully vaccinated. Moreover, employers should be cognizant of applicable state laws that may impact their ability to reveal employee vaccination status. Returning to the Workplace Finally, an employer’s decision regarding COVID-19 face mask policies can have a significant impact on their ability to return employees to the workplace. Many businesses are just beginning to return to the workplace. While some employees may welcome the news that the CDC no longer requires fully vaccinated individuals to wear masks, others may be leery of eased restrictions after working remotely for over a year, even if fully vaccinated. Employers should carefully consider their workforce to determine whether it is practical to adopt policies allowing fully vaccinated individuals not to wear a mask while at work. Polsinelli attorneys will continue to monitor and report on any updated guidance from the CDC, EEOC, and other government agencies, and are available to answer your questions about vaccine-related policies.

This is part three of a 3-part series, and the second of several posts addressing remote work considerations arising out of the COVID-19 pandemic. This series explores tips from companies that have figured out how to run a business with a remote workforce, with advice on how to help re-engage your remote workforce, or, if you already have a good system in place, how to make sure you keep employees productive and satisfied.  Don’t miss Tip One and Tip Two. Tip Three: Decide on Communication Rules. And tell employees. If employers leave the choice of the communication venue - and the way employees should communicate with management and each other - up to employees, employers may be disappointed. If there is no set standard, and no one knows what is expected of them, there is likely going to be frustration from both sides. However, you can create a synchronous culture where your team is expected to communicate at regular intervals during the day, or via a certain platform when they need to share ideas, ask questions, or merely check-in. For some office cultures, that could mean employees know they must communicate with each other and share when they will be away, whether for lunch, a rest, or dealing with homeschooling (which is where flexibility comes in). Setting standards and executing communication strategies can easily be done through technology, by having employees change their status, or send a Teams message, or Slack their colleagues with updates throughout the day. This past year has shown that with remote work comes a lack of situational cues; we do not have the in person interactions that help us understand and see our colleagues’ efforts and output (reducing trust). This results in miscommunications, and a host of problems that follow. Therefore, drafting a well-designed remote work policy with communication as a key component will go a long way. If the remote work environment has been set up well, with expectations clearly defined, and continued and ongoing communication as a key component, there is no reason it cannot work just as good, or better, than an in-office set-up. The overall advice is to treat employees like professionals, and your workforce will thank you for it by making your organization more successful.

As expected, this week, the Biden administration has formally withdrawn a Trump administration rule that was set to change the standard applicable to independent contractors. Whether a worker is an independent contractor or an employee has long been determined by the “economic realities” of the relationship. Several factors are considered in this analysis: the nature and degree of the employer’s control and the permanency of the worker’s relationship with the employer; the worker’s investment in facilities, equipment or helpers; the amount of skill; the worker’s opportunities for profit or loss; the extent of the integration of the worker’s services into the employer’s business. The Trump administration’s proposed rule would have elevated two of the factors of the “economic realities” above the others by deeming the nature and degree of the worker’s control over the work and the worker’s opportunity for profit or loss as “probative.” This would have been a marked departure from past practice as previously, none of the factors were dispositive or more probative. The Biden administration’s Department of Labor noted that the Trump administration rule had not been used by any court or any wage and hour agency. The Department further questioned whether the rule was fully aligned with the Fair Labor Standards Act’s text and purpose or case law describing the economic realities test. In withdrawing the rule promulgated under the Trump administration, the Department of Labor specifically said it “is not creating a new test, but is instead leaving in place the current economic realities test, which allows for determinations that some workers are independent contractors.” While not issuing a new test in this repeal, it is widely expected that the Biden Administration will eventually issue a new rule for evaluating independent contractor status. Secretary of Labor Marty Walsh recently has gone as far as to say “in a lot of cases, gig workers should be classified as employees.” Employers should continue to be cognizant of and comply with any applicable state and local laws regarding worker classification, which may not be identical to the economic realities test. Employers should consult with their Polsinelli attorney if they have any questions and should stay tuned to future blog postings with updates on future rule changes.

This is part two of a 3-part series, and the second of several posts addressing remote work considerations arising out of the COVID-19 pandemic. This series explores tips from companies that have figured out how to run a business with a remote workforce, with advice on how to help re-engage your remote workforce, or, if you already have a good system in place, how to make sure you keep employees productive and satisfied.  Don’t miss Tip One and Tip Three. Tip Two: Be Flexible and Trust. The companies that were working remotely before the pandemic have been teaching and guiding us through this past year, and one major lesson is the ability (and need) to be flexible in the remote environment. For most employers, there is less of a need to require employees to be “on” at all moments of the day. If nothing else, remote work during a pandemic - with home schooling and child and family responsibilities increased during the normal workday - has shown us that employees can manage their time to work best for them, and still get their work done. Flexibility depends on trust. The remote work environment presents us with the requirement to trust employees, yet building trust in a remote environment can be difficult. Without the opportunity to observe a coworker working diligently, or bringing notes to a meeting, or sharing insights with colleagues in the hallway, can make trust hard to embrace. But rapport between coworkers and interpersonal trust is what helps employees understand and ultimately help each other (which is critical to a successful enterprise). So how do you get it? Monitoring and micro-managing to ensure output does not tend to work (in fact, it never works). Employees under surveillance know they are not trusted, and that results in employees with higher levels of anxiety and stress. This, then, results in increased burnout and dissatisfaction, undermining the entire point of a company’s goal, which is to improve work product and output. The first step in building trust is for leadership to show, and put trust in, employees who will then in turn trust leadership; according to the Harvard Business Review this is called reciprocal leverage. The more trust your employees have in the leadership of the company, the more stability they feel, and the more likely they will be to work productively and seek to impress. But how do you know if they are doing the work?  Check-ins and a review of employee production will generally tell you what you need to know. Is your workforce producing work product and output? If it has declined, or is notably absent, there is a problem that must be addressed. If not, perhaps embracing flexibility and trust is working. Employers can and should take action through discussions or discipline when the remote work requirements are not being met. Trusting the employee to continue to perform and produce quality work does not mean remaining on the sidelines if that does not appear to be successful. The idea, however, is that it can be the exception, not the rule.

On April 27, 2021, President Biden signed Executive Order 14026, which increases the minimum wage for workers on or in connection with a federal government contract to $15.00 as of January 30, 2022.  This Executive Order increases the minimum wage level set by President Obama’s 2014 Executive Order 13658, which has been set at $10.95 per hour since January 1, 2021. The new minimum wage applies to most new federal contracts, contract-like instruments, solicitations, extensions or renewals of existing contracts or contract-like instruments, and exercises of options on existing contracts or contract-like instruments that are entered into or exercised on or after January 30, 2022.  However, the Executive Order “strongly encourage[s]” agencies to ensure, to the extent permitted by law, that the wages paid under existing contracts are consistent with the Executive Order’s requirements.  The Executive Order provides that compliance with the increased minimum wage will be a condition of payment on the government contract, raising the potential for False Claims Act liability if a government contractor accepts payment on a federal contract while failing to pay covered workers the required wage.  The Executive Order’s requirements must, in many circumstances, be included in subcontracts. Although the Executive Order does not elaborate on which employees work “on or in connection” with a federal contract, it is likely that the Department of Labor’s forthcoming regulations implementing the Executive Order will follow the lead of its previous regulations implementing Executive Order 13658.  Under those regulations, workers perform services “on” a contract if they directly perform the services called for by the contract’s terms, and they perform services “in connection with” a contract if they perform work activities that, although not specifically called for by the contract, are necessary to the contract’s performance. The Executive Order also addresses the cash portion of the tipped minimum wage for covered workers.  The cash wage for covered workers who qualify as tipped employees will increase to $10.50 as of January 30, 2022.  The wage will then increase as of 85% of the general minimum wage as of January 30, 2023, and 100% of the general minimum wage as of January 30, 2024, at which point the tip credit will be eliminated. The Department of Labor is required to issue regulations implementing the Executive Order by November 24, 2021.  Federal contractors and subcontractors should consider beginning preparations for the increased minimum wage now, in advance of the regulations, by identifying potentially covered workers whose wages may require adjustment.  Polsinelli will continue to update the contractor community when regulations are issued.

On April 27, 2021, President Biden signed Executive Order 14026, which increases the minimum wage for workers on or in connection with a federal government contract to $15.00 as of January 30, 2022.  This Executive Order increases the minimum wage level set by President Obama’s 2014 Executive Order 13658, which has been set at $10.95 per hour since January 1, 2021. The new minimum wage applies to most new federal contracts, contract-like instruments, solicitations, extensions or renewals of existing contracts or contract-like instruments, and exercises of options on existing contracts or contract-like instruments that are entered into or exercised on or after January 30, 2022.  However, the Executive Order “strongly encourage[s]” agencies to ensure, to the extent permitted by law, that the wages paid under existing contracts are consistent with the Executive Order’s requirements.  The Executive Order provides that compliance with the increased minimum wage will be a condition of payment on the government contract, raising the potential for False Claims Act liability if a government contractor accepts payment on a federal contract while failing to pay covered workers the required wage.  The Executive Order’s requirements must, in many circumstances, be included in subcontracts. Although the Executive Order does not elaborate on which employees work “on or in connection” with a federal contract, it is likely that the Department of Labor’s forthcoming regulations implementing the Executive Order will follow the lead of its previous regulations implementing Executive Order 13658.  Under those regulations, workers perform services “on” a contract if they directly perform the services called for by the contract’s terms, and they perform services “in connection with” a contract if they perform work activities that, although not specifically called for by the contract, are necessary to the contract’s performance. The Executive Order also addresses the cash portion of the tipped minimum wage for covered workers.  The cash wage for covered workers who qualify as tipped employees will increase to $10.50 as of January 30, 2022.  The wage will then increase as of 85% of the general minimum wage as of January 30, 2023, and 100% of the general minimum wage as of January 30, 2024, at which point the tip credit will be eliminated. The Department of Labor is required to issue regulations implementing the Executive Order by November 24, 2021.  Federal contractors and subcontractors should consider beginning preparations for the increased minimum wage now, in advance of the regulations, by identifying potentially covered workers whose wages may require adjustment.  Polsinelli will continue to update the contractor community when regulations are issued.

This is part one of a 3-part series, and the second of several posts addressing remote work considerations arising out of the COVID-19 pandemic. This series explores tips from companies that have figured it out, and have advice on how to help re-engage your remote workforce, or, if you already have a good system in place, how to make sure you keep employees productive and satisfied. For employers that did not have much experience with remote work pre-pandemic, 2020 was a steep learning curve. Part of this change has been how to manage – and maintain – office culture and employee engagement when everyone is behind a screen. Because employee engagement and productivity are so directly linked, it is imperative that employers consider both. Leadership should keep in mind that it matters – and is worth the effort – to ensure that workers are in an environment (whether remote or otherwise) where they can thrive, are appreciated, and feel they are providing value. Employee engagement also coincides with better communication, lower absenteeism, fewer health and safety issues, and ultimately, reduced legal risk. Tip One: Make Small Talk a Part of Your Meetings. This idea may make many cringe, considering a large number of employees are suffering from “Zoom fatigue,” and the endless work day that bleeds into home and family time. But a small act of deliberately making space for colleagues to just talk, on a more personal level, can increase a team’s connection and bring a bit of levity to what can become overly structured, endless, meetings. This can be as simple as starting a team meeting with a check-in, or an icebreaker, or perhaps including an agenda item that requires participants to share opinions and conjecture. What we have learned over this year of increased remote work environments is that maintaining and growing a company’s culture should not – and does not have to – stop because we are not all in the same room. Casually chatting with a colleague while grabbing coffee, or stopping to talk in the hallway, or catching up over lunch, leads to feeling part of something bigger, sparks ideas, and helps increase happiness and satisfaction at work. Now we just have to do it a little differently, and be more purposeful to ensure that it happens. Click here to read Tip Two. Click here to read Tip Three

As more businesses prepare to return to the workplace, employers everywhere are evaluating whether to mandate COVID-19 vaccination as a condition of employment or simply encourage vaccination. For many employers, this decision hinges on the company’s ability to offer employees incentives to take the vaccine – including paid time off, cash, or gifts. However, offering incentives can implicate a variety of legal issues under state and federal statutes, including the potential for such incentives to violate wellness program rules. With so much legal uncertainty surrounding vaccine incentives, many employers have been reluctant to offer incentives that might otherwise encourage vaccination and expedite the process of safely returning employees to work. In early February, over 40 organizations from a wide array of industries submitted a letter to the Equal Employment Opportunity Commission (“EEOC”), requesting that the EEOC quickly provide clarity “on the extent to which employers may offer their employees incentives to vaccinate without running afoul of the Americans With Disabilities Act and other laws enforced by the EEOC.” On April 15, 2021, the EEOC finally answered the call of these businesses, announcing that it “expects to update its technical assistance about COVID-19 to address these [vaccine incentive] issues, among others, and that work is ongoing.” The EEOC did not go so far as to provide a date by which this guidance would be issued, but businesses will be eagerly awaiting. Polsinelli attorneys will continue to monitor and report on any updated guidance from the EEOC and are available to answer questions about vaccine policies and related incentives.

On March 31, 2021, in United States ex rel. Felten v. William Beaumont Hospital, the Sixth Circuit Court of Appeals held that an employer’s allegedly retaliatory conduct directed at an employee after the employee’s termination can give rise to a False Claims Act (FCA) retaliation claim.  In doing so, the Sixth Circuit embraced a minority position among courts nationwide and created a split with the Tenth Circuit, which held in 2018 that only retaliation against someone who is a current employee at the time can support an FCA claim. The facts of Felten are relatively straightforward.  Mr. Felten believed that his employer, a hospital, was violating the FCA and an analogous Michigan statute by paying kickbacks to physicians and physicians’ groups in exchange for referrals of Medicare, Medicaid, and TRICARE patients.  Mr. Felten filed a qui tam action against his employer, and also asserted that his employer retaliated against him by threatening and marginalizing him for insisting on compliance with the law. After the federal and state governments intervened and settled the qui tam claim, Mr. Felten amended his complaint to add new claims that he was terminated from his employment and, after termination, had been unable to obtain a comparable position because his now-former employer disparaged him to nearly 40 institutions in retaliation for his reports of unlawful conduct.  The district court granted the hospital’s motion to dismiss Mr. Felten’s claims based on the alleged post-termination disparagement, finding that the FCA’s anti-retaliation provision only applied to retaliatory conduct occurring during the employment relationship, and not to disparagement of an employee occurring after his employment has ended. The Sixth Circuit reversed this ruling, finding that an “employee,” for purposes of the FCA, includes both current and former employees of a government contractor.  The court noted that the Tenth Circuit held otherwise in its 2018 Potts v. Center for Excellence in Higher Education, Inc., 908 F.3d 610 (10th Cir. 2018) decision, but departed from its sister circuit’s reasoning.  Instead, the Sixth Circuit relied heavily on the Supreme Court’s decision in Robinson v. Shell Oil Co., 519 U.S. 337 (1997), holding that under Title VII former employees may bring retaliation claims for actions occurring after the termination of their employment.  The court explained that some of the retaliatory actions prohibited by the FCA – such as, threatening, harassing, and discriminating – can refer to actions against former employees, and that some “terms and conditions of employment” persist after an employee’s termination.  The court also explained that a contrary result would incentivize employers to rush to fire employees who the employees believe may engage in FCA protected activity, undermining FCA’s purpose. Because of the circuit split the Sixth Circuit’s decision created, this may be a decision to watch for future developments.  Regardless of what may happen next, the Felten decision is a useful reminder that when an employee engages in potentially protected activity, whether under the FCA, other whistleblower statutes, or anti-discrimination laws, employers must act with care in personnel actions involving that employee.  In some cases, employers may win the battle but lose the war, showing that the “concerns” the employee reported were non-issues, but facing retaliation liability because of how managers or others treated the employee after he or she made the reports.  Felten emphasizes that this care must continue even after the employee departs the organization.

On March 31, 2021, in United States ex rel. Felten v. William Beaumont Hospital, the Sixth Circuit Court of Appeals held that an employer’s allegedly retaliatory conduct directed at an employee after the employee’s termination can give rise to a False Claims Act (FCA) retaliation claim.  In doing so, the Sixth Circuit embraced a minority position among courts nationwide and created a split with the Tenth Circuit, which held in 2018 that only retaliation against someone who is a current employee at the time can support an FCA claim. The facts of Felten are relatively straightforward.  Mr. Felten believed that his employer, a hospital, was violating the FCA and an analogous Michigan statute by paying kickbacks to physicians and physicians’ groups in exchange for referrals of Medicare, Medicaid, and TRICARE patients.  Mr. Felten filed a qui tam action against his employer, and also asserted that his employer retaliated against him by threatening and marginalizing him for insisting on compliance with the law. After the federal and state governments intervened and settled the qui tam claim, Mr. Felten amended his complaint to add new claims that he was terminated from his employment and, after termination, had been unable to obtain a comparable position because his now-former employer disparaged him to nearly 40 institutions in retaliation for his reports of unlawful conduct.  The district court granted the hospital’s motion to dismiss Mr. Felten’s claims based on the alleged post-termination disparagement, finding that the FCA’s anti-retaliation provision only applied to retaliatory conduct occurring during the employment relationship, and not to disparagement of an employee occurring after his employment has ended. The Sixth Circuit reversed this ruling, finding that an “employee,” for purposes of the FCA, includes both current and former employees of a government contractor.  The court noted that the Tenth Circuit held otherwise in its 2018 Potts v. Center for Excellence in Higher Education, Inc., 908 F.3d 610 (10th Cir. 2018) decision, but departed from its sister circuit’s reasoning.  Instead, the Sixth Circuit relied heavily on the Supreme Court’s decision in Robinson v. Shell Oil Co., 519 U.S. 337 (1997), holding that under Title VII former employees may bring retaliation claims for actions occurring after the termination of their employment.  The court explained that some of the retaliatory actions prohibited by the FCA – such as, threatening, harassing, and discriminating – can refer to actions against former employees, and that some “terms and conditions of employment” persist after an employee’s termination.  The court also explained that a contrary result would incentivize employers to rush to fire employees who the employees believe may engage in FCA protected activity, undermining FCA’s purpose. Because of the circuit split the Sixth Circuit’s decision created, this may be a decision to watch for future developments.  Regardless of what may happen next, the Felten decision is a useful reminder that when an employee engages in potentially protected activity, whether under the FCA, other whistleblower statutes, or anti-discrimination laws, employers must act with care in personnel actions involving that employee.  In some cases, employers may win the battle but lose the war, showing that the “concerns” the employee reported were non-issues, but facing retaliation liability because of how managers or others treated the employee after he or she made the reports.  Felten emphasizes that this care must continue even after the employee departs the organization.

On March 30, 2021, the Office of Federal Contract Compliance Programs (OFCCP) announced that it was lowering the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) hiring benchmark again this year.  Effective March 31, 2021, the new benchmark is 5.6 percent, down from 5.7 percent in 2020.  This marks the seventh consecutive year that the benchmark has been lowered since its inception in March 2014, when it was set at 7.2 percent. VEVRAA is designed to provide equal opportunity and affirmative action for Vietnam era veterans, special disabled veterans, and veterans who served on active duty during a war or in certain campaigns.  Contractors are required to establish annual hiring benchmarks for protected veterans and assess their progress against that benchmark. Contractors have the option of establishing their own benchmark or adopting OFCCP’s annual national benchmark. Additional information regarding VEVRAA compliance and the national benchmark can be found on the OFCCP website.

On March 19, 2021, California Governor Gavin Newsom signed into law S.B. 95, which requires covered California employers to provide qualifying employees with up to 80 additional hours of COVID-19-related paid sick leave through September 30, 2021, upon oral or written request by the employee.  The new state law, which goes into effect beginning March 29, 2021, applies to all California employers with more than 25 employees.  Some of the more notable features of the new state law include: Establishing a new “bank” of 80 hours of COVID-19-related supplemental paid sick leave for covered employees Expanding the qualifying reasons for COVID-19-related sick leave under state law, including the addition of a COVID-19 vaccination appointment and recovery from COVID-19 vaccination-related symptoms as qualifying reasons for leave Requiring employers to provide employees with notice of their rights to expanded COVID-19-related leave Providing special COVID-19-related leave for providers of in-home supportive services and waiver personal care services Authorizing retroactive payments to employees who took unpaid leave for qualifying COVID-19-related reasons on or after January 1, 2021 The provisions of the new state law providing for retroactive payments to employees who took qualifying leave on or after January 1, 2021 are likely to cause problems for employers, who may find it difficult to question employee requests for such retroactive payments in the absence of detailed record-keeping that memorialized these employees’ stated reasons for having taken leave.  However, employers should note that they are not required to make such retroactive payments unless and until they receive an oral or written request from a covered employee. Additionally, employers should note that SB 95 allows for employers to offset any COVID-19 related leave provided to employees on or after January 1, 2021 that was payable for the same reasons and at the same rate as provided in SB 95. As COVID-19-related sick leave and other employment-related issues regarding COVID-19 continue to evolve, Polsinelli attorneys continue to monitor new developments in this area and remain prepared to assist employers with navigating these issues.

Illinois employers have long been prohibited from using arrest records as the basis for employment decisions under Section 103 of the Illinois Human Rights Act (“IHRA”).  On March 23, 2021, Illinois Governor J.B. Pritzker signed Senate Bill (SB) 1480 (the “Amendment”) into law, which added a new Section 103.1 to the IHRA that severely restricts the ability of employers to rely on conviction records in making employment decisions.  Section 103.1 is effective immediately, and prohibits use of a conviction record as the basis for an employment decision unless (1) there is a “substantial relationship” between one or more of the candidate’s prior convictions and the job at issue; or (2) employment would involve an “unreasonable risk to property or to the safety or welfare of specific individuals or the general public.” To determine whether a “substantial relationship” exists, employers are required to evaluate six factors set forth in the Act: (1) the length of time since the conviction; (2) the number of convictions that appear on the conviction record; (3) the nature and severity of the conviction and its relationship to the safety and security of others; (4) the facts or circumstances surrounding the conviction; (5) the age of the employee at the time of the conviction; and (6) evidence of rehabilitation efforts.  If an employer determines that such a relationship exists, it must then engage in an interactive process comparable what is required under the federal Fair Credit Reporting Act (“FCRA”). The Illinois Department of Human Rights has provided additional guidance through an FAQ, but it still leaves a number of open questions.  Ultimately, an employer will need to be prepared to offer a thoughtful, well-reasoned explanation for why it considered a conviction disqualifying. One final point for consideration is the opening clause of Section 103.1, which prefaces the prohibition with the words “Unless otherwise authorized by law….”  There may be other legal obligations that require an employer to disqualify an employee based on certain convictions.  For example, the Illinois Health Care Worker Background Check Act establishes a number of “disqualifying offenses” that would likely fall within the parameters of the Amendment’s prefatory language. Ultimately, the legal pitfalls for Illinois employers seeking background information regarding applicants and employees continue to multiply.  In addition to the Amendment and the FCRA, Illinois employers should remember that the Illinois Employee Credit Privacy Act places restrictions on an employer’s ability to take action based on an employee’s credit history.  As this landscape continues to get more complex, it is wise for employers to get legal assistance both in terms of developing background check processes and navigating next steps following receipt of a negative background check.

This is the first of several posts addressing remote work considerations arising out of the COVID-19 pandemic. We are now well into 2021 and more and more employers are considering the return to office plan. But what if you don’t? There are many reasons why you might be considering keeping most, or all, of your employees remote. Many employees want this option, for all the reasons you might expect: flexibility, no commute, meetings are actually easier and quicker via video, the wardrobe becomes much simpler, and the list goes on. A recent Gallup poll found "three in five U.S. workers who have been doing their jobs remotely from home during the coronavirus pandemic would prefer to work remotely as much as possible…" But what are some of the biggest concerns employers have with a more permanent remote workforce? Here are a few important considerations: Properly paying employees when you cannot see them come and go. Employers are required to pay employees for all hours worked, including work not requested but permitted; this of course includes work performed at home outside of the normal workday. This past summer, the Department of Labor provided guidance, reiterating that if an employer knows or has reason to believe that work is being performed, the time must be counted as hours worked. Courts will assess whether the employer should have acquired knowledge of hours worked through reasonable diligence. Therefore, employers must ensure they are properly accounting for their employees’ hours, even emails or messages that come through after hours. Managers should be aware of these rules, and ensure that work is not happening outside of normal hours (unless it is accounted for). Privacy and confidentiality. With a larger number of employees handling employers’ information from the comfort of their homes, the way data is stored and shared needs to be reassessed. If your employer policies that cover confidentiality and security have not been updated to address the work-from-home environment, take time to review those and make necessary changes. Include training for employees on how to transfer data, how to recognize when information is confidential or highly sensitive, and make sure you know what devices employees are using (and where they are storing company information). There are many software solutions available for employers to allow them to monitor their networks and flag suspicious activity or receive alerts if large amounts of data is being downloaded. Employees living…anywhere and everywhere. One of the big surprises some employers faced with a new remote workforce was finding out some employees moved (and sometimes without telling their employer). Employees’ ability to live anywhere is, generally speaking, a great perk to the remote work option, but employers need to be aware of the issues.  There are different tax and payroll concerns when you live in a different state and, as an employer, you have to be prepared to handle the insurance and benefit issues in that new location. For example, in New York, after only two weeks of working there, an employer will be subject to payroll tax implications, and will need to address business license fees. Employers are required to register and obtain workers’ compensation and unemployment insurance in the state where the employee is working. Typically, these state rules are based on where the employee is working, even if at home, and not where the business is located. Therefore, it is important for employers to draft policies to ensure employees alert the employer to their intention – or desire – to relocate. To avoid headaches in new states, employers can implement policies that require employees stay within a certain vicinity of the employer’s location. If you have questions or would like more detailed information regarding remote work considerations, Polsinelli’s Labor & Employment team is here to assist.

Employer obligations to provide paid sick and family leave under the Families First Coronavirus Response Act (FFCRA) ended on December 31, 2020. On December 27, 2020, President Trump signed the Consolidated Appropriations Act of 2021 (CAA), extending the payroll tax credits available to employers who voluntarily decided to continue to provide FFCRA-type leave through March 31, 2021. Last week, President Biden signed the American Rescue Plan Act of 2021 (Rescue Plan). Among other things, the Rescue Plan extends the availability of the payroll tax credits to employers through September 30, 2021. Additionally, for those employers who opt to continue to provide FFCRA-type leave, the Rescue Plan makes several significant changes to how the FFCRA is to be implemented with regard to both Paid Sick Leave (two weeks/up to 80 hours of paid leave) and Emergency Family and Medical Leave (originally up to 10 weeks of paid Family and Medical Leave). Changes to Paid Sick Leave The Rescue Plan resets the 10-day/80-hour limit for Paid Sick Leave starting April 1, 2021.  This means, if employees have previously exhausted their entitlement to Paid Sick Leave under the FFCRA, they now have another 10-days/80-hours for use. The Rescue Plan also adds three additional qualifying reasons for Paid Sick Leave.  These include: Obtaining a COVID-19 vaccine; Recovering from any illness or condition related to the COVID-19 vaccine; or Seeking or awaiting the results of a COVID-19 diagnosis or test if either the employee has been exposed to COVID-19 or the employer requested the test or diagnosis. Changes to Emergency Family and Medical Leave A major change is the Rescue Plan’s elimination of the requirement that the first two weeks of Emergency Family and Medical Leave (EFML) be unpaid.  Now, if an employee qualifies for EFML, they are eligible for a full 12 weeks of paid leave (assuming they have not previously used any EFML or other leave under the Family and Medical Leave Act (FMLA)).  Consistently, the Revenue Plan increases the total cap for EFML from $10,000 to $12,000. Another important change is the expansion of qualifying reasons to use EFML. Currently, employees can only use EFML if they need time off to care for a child whose school or daycare is closed due to COVID-19 related reasons. Under the Rescue Plan, however, EFML can be used for any of the qualifying reasons found under Paid Sick Leave.  This means, if an employee qualifies for Paid Sick Leave and needs leave beyond the 10-day entitlement for Paid Sick Leave, the employee could take up to an additional 12 weeks of EFML (assuming they have not previously used any EFML or time off under the FMLA).  In practical terms, after April 1, 2021, an employee could potentially take up to a total of 14 weeks of paid FFCRA leave. Finally, the Rescue Plan contains non-discrimination language for both Paid Sick Leave and EFML. The penalties come in the form of losing the tax credit option. If an employer opts to voluntarily provide FFCRA leave and discriminates with respect to leave: (1) in favor of highly compensated employees; (2) in favor of full-time employees; or (3) on the basis of employment tenure, the employer will not be able to obtain tax credits for any leave paid under the FFCRA framework. With this new benefit comes a big question for employers – whether to extend these FFCRA credits to employees? It is worth considering, given the benefit of providing paid time off to encourage employees to get vaccinated and to ensure the safety and health of their workforce by supporting COVID-related absences due to exposure and illness. (And being able to do so without such a financial hit to the business is a big plus). What employers must be prepared for, however, is being ready to provide potentially 14 weeks of leave to employees.  At this time, it is not clear whether employers can pick and choose what types of paid leave they will provide under the FFCRA; for example, some employers may want to offer the two weeks of Paid Sick Leave but not offer the 12-weeks of EFML.  We know that failure to comply with any requirement of the Emergency Family and Medical Leave Expansion Act or the Emergency Paid Sick Leave Act disqualifies the employer from obtaining tax credits for leave paid under either Act. When that rule is coupled with the non-discrimination language, it appears an employer could arguably choose to provide Paid Sick Leave or Emergency Family and Medical Leave, or both. But in doing so, employers need to understand that they must follow the entirety of the provisions related to each leave option. This means, while employers can choose to provide only one type of leave, employers cannot change the rules; they cannot pick and choose the qualifying reasons for leave, or make other changes to how the leave should be applied. The Rescue Plan’s provisions related to the FFCRA become effective April 1, 2021.  We anticipate the Department of Labor and/or Internal Revenue Service will issue additional guidance or FAQs to assist employers with some of these open questions, and we will continue to provide updates as we learn more. If you have questions or would like more detailed information regarding these recent changes, Polsinelli’s Labor & Employment team is here to assist.

The American Rescue Plan that was sent to President Biden’s desk on March 11, 2021 includes an $86 Billion aid package that provides financial assistance to underfunded multiemployer pension plans facing critical or declining financial status. Upon signature, the bill will provide eligible underfunded plans with “special financial assistance.” The special financial assistance is designed to cover the payments of accrued pension benefits through the 2051 plan year and is not subject to any repayment obligations. Multiemployer pension plans eligible for special financial assistance include plans meeting any one of the below criteria: Plans in critical and declining status in any plan year from 2020 through 2022. Plans that have had a suspension of benefits approved under the provisions of the Multiemployer Pension Reform Act of 2014 as of the date the new American Rescue Plan becomes law. Plans certified by an actuary to be in critical status in any plan year from 2020 through 2022, have a modified funded percentage of less than 40 percent, and a ratio of less than 2 active participants to 3 inactive participants. Plans that became insolvent after December 16, 2014 that have not been terminated by the date the American Rescue Plan is signed into law. The Pension Benefit Guaranty Corporation (“PBGC”) has 120 days to issue regulations or guidance setting forth application requirements for special financial assistance. Because eligible plans have through December 31, 2025 to apply for special financial assistance, plans may not receive any special financial assistance for several years. Prior to sending the bill back to the House of Representatives, the Senate removed a significant provision concerning employer withdrawal liability. The original language drafted by the House of Representatives provided that an employer’s withdrawal liability would be calculated without taking into account the special financial assistance received by a pension plan for 15 calendar years following the receipt of such assistance. While the removal of this language may allow for quicker relief for employers, they are left without clarity as to how and when the special financial assistance will impact their withdrawal liability, if at all. Instead, employers must wait for the PBGC to issue regulations or guidance on the issue. The legislation provides extensive assistance to pension plans that were suffering long before the COVID-19 pandemic and ensures that many retirees will receive their full benefits. However, it does not freeze accruals, curtail the practices that led to the pension plans’ current underfunding problems, or otherwise provide guidance as to how the plans will function financially in 30 years when the special financial assistance ends. Polsinelli attorneys will continue to monitor the PBGC’s issuance of regulations and other developments and remain prepared to assist with any questions.

Warning/Apologies: This video contains multiple references to poop and may be offensive to fans of the Dave Matthews Band or Governor Andrew Cuomo of New York. Workplace bullying has not diminished during the pandemic. The Workplace Bullying Institute (WBI) recently released its 2021 U.S. Workplace Bullying Survey: https://workplacebullying.org/2021-wb... . Promoting civility in the workplace - and interrupting jerk behavior - is critical to building a respectful workplace culture and to our having a healthy return to normal life after the pandemic. The 2004 Poopgate bridge incident in Chicago is a vivid example of how one jerk can impact others.

On March 2, 2021, the Office of Federal Contract Compliance Programs (OFCCP) amended its Corporate Scheduling Announcement List (CSAL) for supply and service contractors for fiscal year 2020 to remove all of the contractor establishments previously selected for Section 503, accommodation, and promotions focused reviews and compliance checks. This leaves only the 500 compliance evaluations listed in the previous CSAL scheduled for audit at this time. OFCCP also published an amendment to its scheduling methodology. Although this amendment reduces the number of contractor establishments selected for OFCCP audits in fiscal year 2020 from 2,250 to 500, we anticipate that the amendment may turn out to be the first step in an increase in OFCCP audit activity this fiscal year. It appears OFCCP may be refocusing its resources towards the more extensive compliance evaluations and away from the more limited focused reviews and compliance checks, and may issue another CSAL scheduling additional compliance evaluations at some point later in the year. According to FAQ guidance released by OFCCP in connection with the amended CSAL, the changes will not affect pending focused reviews from CSALs issued prior to fiscal year 2020.  In addition, as confirmed by OFCCP’s FAQs, the amendment to the supply and service CSAL will not affect construction contractors who were scheduled for compliance checks or other reviews on the fiscal year 2020 construction CSAL. The amendment to the supply and service CSAL appears to forecast a reversal of former OFCCP Director Craig Leen’s initiative to refocus OFCCP’s enforcement activity on disability and veteran-related compliance issues, as the focused review program had been an important part of Director Leen’s initiatives.  It appears that OFCCP will now instead conduct more compliance evaluations that review the full range of the contractor’s personnel activity and practices and also expose contractors to greater monetary costs and potential liability.

On February 25, 2021, in In Donohue v. AMN Services, LLC (2021) San Diego Superior Court, Case No. 37-2014-00012605-CU-OE-CTL, the California Supreme Court weighed in on two important issues pertaining to meal periods.  First, the Court held that California employers cannot round time punches for meal periods (although it is arguably permissible for work start and stop times).  Second, the Court held that employee time records showing non-compliant meal periods raise a rebuttable presumption of meal period violations and are sufficient to defeat a defendant’s dispositive motion for summary judgment. The Court emphasized that California’s meal period requirements are designed to prevent even minor infringements on employees’ meal periods and that rounding employees’ meal period time punches for even a de minimus amount violates state law. In Donohue, the defendant-employer, a healthcare services and staffing company, used a timekeeping system that rounded employees’ time punches for meal periods to the nearest 10-minute increment.  For example, if an employee punched out for lunch at 11:03 a.m. (rounded back to 11:00 a.m.) and punched back in at 11:24 a.m. (rounded forward to 11:30 a.m.), the system recorded a 30-minute meal period (even though only 21 minutes had actually elapsed).  The Court found that this rounding policy resulted in many employees not taking their full 30-minute meal breaks. The Court also noted that employees were paid a premium payment only if the employee proactively indicated that their meal period was missed, short, or late.  As a result, the Court found that there was sufficient evidence to suggest that employees worked over five hours before taking their meal break in violation of California Labor Code § 512 and Industrial Welfare Commission Wage Order No. 4-2001.  The case now heads back down to the Court of Appeals where the parties will submit further briefing on the plaintiffs’ meal period claims. Additionally, in reversing the defendant’s motion for summary judgment win, the Court ruled that records that demonstrate a non-compliant meal period raise a rebuttable presumption of labor code violations, which, the Court clarified, can be overcome by presenting evidence that either (1) the employees were compensated for noncompliant meals or (2) the employees were provided compliant, 30-minute, duty-free meal periods during which time the employee voluntarily chose to work. The Donohue decision serves as helpful guidance on two fronts.  First, it should be used as a warning for employers who use rounding policies for recording meal periods.  Employers who apply time rounding policies in the meal period context likely need to suspend these practices.  Moreover, based on the court’s guidance, employers that utilize general rounding practices should be wary of the potential problems that rounding policies may cause.  Second, employers should utilize paper or electronic acknowledgement forms from employees that confirm that employees are taking their meal breaks and rest breaks on a daily basis or, to the extent they are not, that this is documented as either a voluntary decision by the employee, or if it is not voluntary, that the employee is paid their statutory premium payment. Polsinelli attorneys will continue to monitor developments in this area and remain prepared to assist with any questions regarding timekeeping policies or other employment law issues.

This is the first in a new “rethink work” video series. This video aims to rethink how we approach sexual harassment training. As with our prior COVID videos, this is a video that employers can share with their broader workforce. The EEOC’s Task Force on Harassment found that employer harassment training programs are often ineffective and “too focused on simply avoiding legal liability.” These programs tend to dwell on legal claims and costs while simply walking employees through a checklist of things that they should not do (and which most people already know are wrong). There is little evidence that such training programs have a significant impact on employee attitudes --- people who engage in harassing conduct do not generally suffer from a lack of knowledge about what is right or wrong, they have a behavior problem that needs to be confronted and stopped. Fortunately, there is evidence that training programs can boost internal reporting and complaints, giving employers the chance to confront and stop bad behavior. That is the focus of this video. This initial, 5-minute video is not intended to be a comprehensive harassment training video, but can be incorporated into a larger training effort. Future videos in this series will address other challenges employers face in stopping workplace harassment. Please feel free to pass along this video to your workforce and do not hesitate to contact us if you should have any questions. Polsinelli’s L&E Department offers a full range of counseling, training and investigation services to help employers with workplace harassment issues.

On February 9, 2021, the Biden administration took another step towards reversing the priorities of the Trump-era Office of Federal Contract Compliance Programs (OFCCP), by notifying the U.S. District Court for the Southern District of New York that it intended to rescind the Trump-era OFCCP January 2021 regulation broadening the religious exemption from Executive Order 11246’s nondiscrimination requirements. The notice came in litigation filed by 14 states and the District of Columbia challenging the issuance of the religious exemption regulation.  The notice indicates that OFCCP “intends to propose rescission of the rule,” and that this process will require notice-and-comment rulemaking that will take “several months.”  Beyond that statement and timeline, the notice did not provide insight into OFCCP’s intentions with respect to the religious exemption.  Contractors will have to await the issuance of a Notice of Proposed Rulemaking to learn if OFCCP intends to simply restore the religious exemption to its pre-January 2021 language, or propose a different, middle-ground approach. This early shift indicates that the new administration will not prioritize issues of religious liberty to the same extent as the Trump OFCCP.  It remains to be seen whether the Trump OFCCP’s focus on disability and veterans issues will also be lessened under the new administration.  Contractors should expect additional changes at OFFCP as the new administration continues to pursue its priorities.

On January 27, 2021, the Commonwealth of Virginia became the first state in the country to adopt permanent COVID-19 workplace safety and health standards. As we noted in a previous article, Virginia adopted an emergency temporary workplace safety and health standard in July 2020 to aid in preventing the spread of the pandemic. With Governor Ralph Northam’s approval on January 27, 2021, the permanent standard superseded the July 2020 emergency temporary standard. The permanent standard applies to all employers in the Commonwealth of Virginia that fall within Virginia Occupational Safety and Health’s (“VOSH”) jurisdiction. Accordingly, most private employers in Virginia and employees of the Commonwealth and local governments must comply.  Private and public institutions of higher education are deemed to be in compliance if they have established plans certified by the State Council of Higher Education in Virginia and are acting in compliance with those plans, provided that the certified plans ensure an equivalent or greater level of protection for employees than the VOSH standard. Like the emergency standard, the permanent standard classifies occupations based on “exposure risk level” and requires adherence to various practices based on the risk level of a given occupation. An occupation can have a “very high,” “high,” “medium,” and “lower” exposure risk level based on the risk of transmission. In determining exposure risk levels, employers must consider: (1) the job tasked performed; (2) whether the workplace is indoors or outdoors; (3) the presence of the virus in the workplace; (4) the presences of a person known or suspected to have the virus; (5) the number of employees in relations to the size of the workplace; (6) working distance between employees; and (7) the frequency and duration of close contact employees have with co-workers and other people. The permanent standard further requires employers to ensure that employees practice social distancing in the workplace by making announcements, posting signs, decreasing the density of employees, and adhering to Virginia’s occupancy limits. Employers must also provide employees access to hand sanitizer and cleaning supplies, develop procedures for sanitation, and train employees on ways to prevent the spread of COVID-19. If employees must share a vehicle for work, they must wear the appropriate personal protective equipment (“PPE”). While the permanent standard resembles the July temporary standard, the standards differ in important ways. Under the permanent standard, employers must report to the Virginia Department of health if two or more employees test positive for COVID-19 within a 14-day period instead of reporting each positive COVID-19 test as required by the temporary standard. In addition, the permanent standard prohibits employers from requiring employees who are absent due to the pandemic to provide a negative test before returning to work. Rather, employers must use the symptom-based method based on the Centers for Disease Control and Prevention’s guidelines. The standard also regulates how face masks must be worn, sets limits on the use of face shields, and requires employers to implement ventilation controls in the workplace. Notably, the standard does not contain any provisions regarding how employers can manage employees with vaccine-related issues. Employers in Virginia should prepare and follow comprehensive infectious disease preparedness and response plans to address the requirements in the standard. When preparing the plan, employers should consider including all required training, safe conduct in the workplace, policies and expectations regarding what employees must do if they experience symptoms and receive a positive test, and provisions for returning to work. Although the standard does not address it, employers should also consider ways to handle vaccine-related employee issues in accordance with applicable law. Please feel free to contact us for general advice regarding compliance with the standard or assistance in preparing a complaint plan.