On November 13, 2024, the National Labor Relations Board (“NLRB”) issued a sharply divided decision in Amazon.com Services LLC, overruling yet another decades-old rule and holding that captive-‍audience meetings violate national labor law after being lawful since 1948. Captive-Audience Meetings. A captive-audience meeting occurs when employees are required to attend a meeting where the employer expresses its views on unionization. Under Section 8(c) of the National Labor Relations Act (the “Act”), employers are allowed to express those views so long as there is “no threat of reprisal or force or promise of benefit.” In 1948, the NLRB decided in Babcock & Wilcox Co. that the Act generally does not prohibit captive-audience meetings, even when attendance is compelled through implicit or explicit threats of discipline. The New Ruling. Calling the Babcock & Wilcox rule “largely unexplained” and “flawed as a matter of statutory policy,” the NLRB majority overruled the 76-year-old decision and held that captive-audience meetings and “other similar mandatory employer-employee encounters” are unfair labor practices under Section 8(a)(1) of the Act. The majority explained that such meetings “have a reasonable tendency to interfere with and coerce employees in the exercise of their Section 7 right to freely decide whether or not to unionize” when employees should “be free from such domination.” Under this decision, an employer violates the Act whenever it requires employees to attend a meeting for the employer to express its views on unionization, regardless of whether those expressions support or oppose unionization. What Meetings are Allowed? Under the majority’s decision, a voluntary workplace meeting during work hours is lawful if, reasonably in advance of the meeting, the employer provides and follows through with the following assurances to its employees: The employer intends to express its views on unionization at a meeting at which attendance is voluntary; Employees will not be subject to discipline, discharge, or other adverse consequences for failing to attend the meeting or for leaving the meeting; and The employer will not keep records of which employees attend, fail to attend, or leave the meeting. The Dissent. Member Kaplan, in a lengthy dissent, argued that an employer’s right to hold a captive-audience meeting is supported by the free speech provision in Section 8(c) of the Act, that they are not coercive, and that the majority’s decision unconstitutionally infringes on an employer’s right to free speech. To comply with the NLRB’s majority decision, employers should carefully adhere to the above guidelines for voluntary meetings. For questions and assistance regarding such meetings, please contact your Polsinelli attorney.

On November 8, 2024, the National Labor Relations Board (“NLRB”) issued a decision in Siren Retail Corp. d/b/a Starbucks, throwing out an almost 40-year-old rule that categorically allowed employers to tell their employees how unionization will impact the employer-employee relationship. The NLRB’s new standard will apply to cases filed after November 8, 2024. The Prior Standard. In 1985, the NLRB decided in Tri-Cast, Inc. that employers may lawfully tell their employees that, when they unionize, their relationship will change, and the employer will no longer be able to address individual grievances once the union is involved. Since that time, Tri-Cast, Inc. has been broadly applied as a categorical rule that explaining the negative consequences of unionization is not an unlawful threat, so long as the employer’s statements are truthful. The Starbucks Case. In Siren Retail Corp., the NLRB criticized the Tri-Cast, Inc. standard because it “categorically immunized nearly any employer statement to employees touching on the impact that unionization would have on the relationship between individual employees and their employer” when such statements “could have a reasonable tendency to coerce employees.” Although the NLRB kept the Tri-Cast, Inc. standard for the Siren Retail Corp. case to avoid an unfair result, it prospectively overruled Tri-Cast, Inc. for all cases filed after November 8, 2024. The “New” Standard. The NLRB’s decision in Siren Retail Corp. effectively tosses out the Tri-Cast, Inc. standard in favor of returning to an even older approach set forth in NLRB v. Gissel Packing Co., a case decided by the United States Supreme Court in 1969. Under the Gissel rule, an employer’s statements concerning the potential impact of unionization are evaluated on a case-by-case basis and must be “carefully phrased on the basis of objective fact to convey an employer’s belief as to demonstrably probable consequences beyond his control.” But if, under that case’s circumstances, the statement implies that the employer will act differently “solely on his own initiative for reasons unrelated to economic necessities,” then the statement will be considered an unlawful threat. What Should Employers Do Now? The “new” standard requires an employer’s statements to be not only substantiated with facts beyond the employer’s control but also carefully worded. Because it involves a case-by-case analysis, employers will not have certainty about the risks and legality of their communications. As such, it will be critical for employers to vet communications to employees about unionization efforts with experienced counsel. For questions and assistance regarding your statements to employees and how to comply with this new standard, please contact your Polsinelli attorney.

This month, businesses in Missouri will be permitted to sell recreational marijuana products. The permitted sales are one of the many changes that came about because of Constitutional Amendment 3, which legalized the recreational use of marijuana in Missouri. Notably, employers may still prohibit employees from working while under the influence of marijuana and may discipline, discharge, refuse to hire or otherwise take adverse employment action against an individual for their lawful use of recreational marijuana, even when such use occurs during non-work hours and off the employer’s premises. With the increased availability of recreational marijuana products and the inevitable confusion some employees may have as to what is and is not permitted under Constitutional Amendment 3, it is a good time for employers to revisit their policies and messaging concerning drug and alcohol use and drug testing. Employers should be mindful of the dichotomy between recreational marijuana use and medical marijuana use. For questions or assistance in adjusting your drug and alcohol use and/or drug testing policies, please contact your Polsinelli attorney.

Today, the United States Supreme Court issued two much-anticipated opinions concerning the Occupational Safety and Health Administration’s Emergency Temporary Standard on vaccination and testing (“OSHA ETS”) and the CMS Medicare and Medicaid Programs Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule (“CMS Vaccine Mandate”). I.  In a 6-3 ruling, the Supreme Court stayed the OSHA ETS from taking effect pending resolution of the case in the U.S. Court of Appeals for the Sixth Circuit. In the per curiam opinion, the Supreme Court stated that the challengers to the OSHA ETS “are likely to succeed on the merits of their claim that the Secretary of Labor lacked authority to impose the mandate.” The Supreme Court further held that the OSHA ETS is not authorized by the Occupational Safety and Health Act. The Court noted that Occupational Safety and Health Administration had never adopted a broad public health regulation before. The “lack of historical precedent” and the broad authority to implement the regulation was a “telling indication” that the OSHA ETS is beyond the agency’s authority. For now, the OSHA ETS is stayed pending resolution of the case in the United States Circuit Court for the Sixth Circuit. As such, this case will now return to the Sixth Circuit where the court will hear the case on its merits, and not just for preliminary relief. Bottom Line: At this time, employers do not need to require their workforce to be vaccinated or to get tested in compliance with the OSHA ETS. II.  In a 5-4 ruling, the Supreme Court stayed temporary injunctions of the CMS Vaccine Mandate issued by the U.S. District Courts for the Eastern District of Missouri and the Western District of Louisiana. In stark contrast to the ruling concerning the OSHA ETS, the Supreme Court opined that the CMS Vaccine Mandate fell within the authorities that Congress conferred upon the Secretary of Health and Human Services. The Supreme Court further held that the CMS Vaccine Mandate was not arbitrary and capricious. Now that the temporary injunctions issued by the U.S. District Courts for the Eastern District of Missouri and the Western District of Louisiana have been stayed, covered employers in all states should take steps, or continue to take steps, to comply with the CMS Vaccine Mandate. Bottom Line: Employers subject to the CMS mandate must comply. CMS released guidance to State Survey Agency Directors concerning the CMS Vaccine Mandate (“Guidance”) in late December 2021 in an effort to help companies comply. Under the Guidance, by January 27, 2022, facilities must have: Policies and procedures in place to ensure that all facility staff, regardless of clinical responsibility or patient or resident contact are vaccinated for COVID-19; and 100% of staff have received at least one dose of COVID-19 vaccine, or have a pending request for, or have been granted qualifying exemption, or identified as having a temporary delay as recommended by the CDC. A facility that is above 80% and has a plan to achieve a 100% staff vaccination rate by February 28, 2022 would not be subject to additional enforcement action. Facilities that do not meet these parameters could be subject to additional enforcement actions depending on the severity of the deficiency and the type of facility (e.g., plans of correction, civil monetary penalties, denial of payment, termination, etc.). By February 28, 2022, covered facilities must have: Policies and procedures in place to ensure that all facility staff, regardless of clinical responsibility or patient or resident contact are vaccinated for COVID-19; and 100% of staff have received the necessary doses to complete the vaccine series (i.e., one dose of a single-dose vaccine or all doses of a multiple-dose vaccine series), or have been granted a qualifying exemption, or identified as having a temporary delay as recommended by the CDC, A facility that is above 90% and has a plan to achieve a 100% staff vaccination rate within 30 days would not be subject to additional enforcement action. Facilities that do not meet these parameters could be subject to additional enforcement actions depending on the severity of the deficiency and the type of facility (e.g., plans of correction, civil monetary penalties, denial of payment, termination, etc.). Finally, facilities failing to maintain compliance with the 100% standard by March 28, 2022 may be subject to enforcement action. Polsinelli attorneys will continue to monitor and report on the OSHA ETS and CMS Vaccine Mandate and will host a webinar regarding the current state of all vaccination mandates next Wednesday, January 19 from 12:00 pm to 1:30 pm CT. Please register to attend here. In the meantime, your Polsinelli attorney can assist with questions you have regarding current vaccine mandates.

On December 22, 2021, the Supreme Court of the United States issued orders granting review of legal challenges to the Occupational Safety and Health Administration’s COVID-19 Vaccination and Testing Emergency Temporary Standard (“OSHA ETS”) and the Centers for Medicare and Medicaid Services Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule (“CMS Vaccine Mandate”). In a rare move, the Supreme Court set an accelerated timeline for the cases, scheduling oral arguments in both cases on January 7, 2022. Following a ruling out of the United States Court of Appeals for the Sixth Circuit on December 17, 2021, OSHA announced that it would not issue citations for noncompliance with any requirements of the OSHA ETS before January 10, 2022 and will not issue citations for noncompliance with testing requirements before February 9, 2022, so long as an employer is exercising reasonable, good faith efforts to come into compliance with the OSHA ETS. While it is unknown whether the Supreme Court will be able to issue a ruling by OSHA’s January 10, 2022 compliance date, the Supreme Court’s expedited schedule seems to indicate that it is attempting to give employers some finality concerning their obligations under the federal mandates.

A divided panel of the United States Court of Appeals for the Sixth Circuit lifted the stay on the Occupational Safety and Health Association’s Emergency Temporary Standard (“OSHA ETS”) late Friday night (December 17, 2021). The Sixth Circuit had previously been selected at random to hear the consolidated OSHA ETS litigation. As a result of the Sixth Circuit’s ruling, OSHA announced that it would exercise enforcement discretion with respect to the compliance dates of the OSHA ETS.  To provide employers with sufficient time to come into compliance: OSHA will not issue citations for noncompliance with any requirements of the OSHA ETS before January 10, 2022; and OSHA will not issue citations for noncompliance with testing requirements before February 9, 2022. These “extensions” are conditioned on an employer exercising reasonable, good faith efforts to come into compliance with the OSHA ETS. Ultimately, the Sixth Circuit found that the petitioners (Republican-led states, businesses, religious groups, and individuals) were unable to establish a likelihood of success on the merits. In doing so, the Sixth Circuit considered and analyzed a myriad of statutory and constitutional arguments. Two out of the three judges on the panel determined that the petitioners would be unlikely to be successful on their constitutional arguments that OSHA violated the commerce clause or the non-delegation doctrine. Under the Occupational Safety and Health Act, OSHA is required to show that health effects may constitute a “grave danger” in order to warrant an emergency temporary standard. The Sixth Circuit held that the determination as to what constitutes “grave danger” should be left, in the first instance, to the agency. The Sixth Circuit expressly disagreed with, and in effect overruled, the United States Court of Appeals for the Fifth Circuit by holding that OSHA was not required to make findings of exposure in all covered workplaces. The Sixth Circuit held that to require so would mean that no hazard could ever rise to the level of “grave danger.” Ultimately, the Sixth Circuit found that OSHA had shown that COVID-19 is a danger and relied on proper science in issuing the ETS. The Sixth Circuit further held that simply because OSHA did not issue the ETS at the beginning of the pandemic did not mean the agency did not consider COVID-19 an emergency worth addressing. The Sixth Circuit’s decision was appealed this morning to the Supreme Court; however, this appeal does not alter the decision unless and until the Supreme Court rules.  Polsinelli attorneys will continue to monitor further OSHA ETS developments.  In the meantime, employers should resume (or continue) preparations to comply with the ETS requirements. For a summary of the OSHA ETS and its requirements, visit here.

Today, the Sixth Circuit Court of Appeals, based out of Cincinnati, was selected via lottery by the Judicial Panel on Multidistrict Litigation to hear legal challenges to the OSHA ETS. The OSHA ETS was formally issued on November 5, 2021. For more information on the OSHA ETS, check out Polsinelli’s blog posts discussing its impacts on employers with more than 100 employees here. A three-judge panel from the Sixth Circuit will now be randomly assigned to hear the legal challenges to the OSHA ETS. A majority of the judges currently presiding in the Sixth Circuit were appointed by Republican presidents. It is almost assured that the Biden Administration and OSHA will ask the Sixth Circuit Panel to review and repeal the Fifth Circuit Court of Appeals’ stay of the OSHA ETS. In a decision this past Friday, November 12, 2021, the Fifth Circuit reaffirmed its earlier order halting enforcement of the OSHA ETS, noting that the OSHA ETS “threatens to substantially burden the liberty interests of reluctant individual recipients to put a choice between their job(s) and their jab(s).” Just yesterday, in compliance with the Fifth Circuit’s order halting enforcement of the ETS, OSHA issued a statement that it was suspending “activities related to the implementation and enforcement of the ETS” but provided that OSHA “remains confident in its authority to protect workers in emergencies…” and that it is suspending its activities “pending future developments in the litigation.” Polsinelli attorneys will continue to monitor and report on legal challenges to the OSHA ETS.  In the meantime, your Polsinelli attorney can assist with questions you have regarding current vaccine mandates.

Lawsuits challenging the COVID-19 Vaccination and Testing (the “ETS”) issued by the Occupational Safety and Health Administration (“OSHA”) were filed in three additional U.S. Circuit Courts of Appeals on Wednesday, November 10, 2021. Labor unions filed lawsuits in the U.S. Circuit Court of Appeals for the Second, Fourth, and Ninth Circuits. As a result, there are now ETS-related lawsuits pending in the First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Eleventh, and D.C. Circuit Courts. According to federal rules, the legal challenges to the OSHA ETS will be consolidated and heard by a single U.S. Circuit Court of Appeals. The Judicial Panel on Multidistrict Litigation will conduct a lottery, expected on November 16, to select which U.S. Circuit Court of Appeals will hear the consolidated litigation. The court to hear the litigation will be drawn “from a drum containing an entry for each circuit wherein a constituent petition for review is pending.” Each court only gets one entry, despite the number of petitions pending before each court. Until the Judicial Panel selects the U.S. Circuit Court of Appeals to hear the litigation via the lottery, all the U.S. Circuit Courts of Appeals can proceed with rulings, as the Fifth Circuit did this past weekend. The labor unions’ move may be a move reflective of an intent by some to increase the odds that the OSHA ETS is upheld. The First, Second, and Fourth circuits all have a majority of Democratic-appointed judges. But it is difficult to predict the future of the OSHA ETS as the panel of judges to hear the case is also selected randomly. Polsinelli attorneys will continue to monitor and report on challenges to the ETS.

As previously reported, Texas, Louisiana, Mississippi, South Carolina, Utah and several other private entities filed suit in the U.S. Circuit Court of Appeals for the Fifth Circuit on November 5 requesting review of the emergency temporary standard regarding COVID-19 Vaccination and Testing (the “ETS”) issued by the Occupational Safety and Health Administration (“OSHA”). The lawsuit was accompanied by an emergency motion to stay enforcement of the OSHA ETS. Today, November 6, 2021, the Fifth Circuit granted the emergency motion to stay enforcement pending further action by the Court. The Fifth Circuit provided the Federal government until 5:00 p.m. Monday, November 8, 2021, to respond to the lawsuit’s request for a permanent injunction. The Justice Department declined to comment and the White House referred comment to the Department of Labor. 

Twenty-six states have filed suit to challenge the emergency temporary standard regarding COVID-19 Vaccination and Testing (the “ETS”) issued by the Occupational Safety and Health Administration (“OSHA”) on November 4, 2021, and published in the Federal Register on November 5, 2021. Federal courts have previously held that OSHA rules are ripe for challenge when the rule is published in the Federal Register. Within hours of publication in the Federal Register, the legality of the OSHA ETS is pending in the 5th, 6th, 8th, and 11th U.S. Circuit Court of Appeals. A coalition including Missouri, Arizona, Nebraska, Montana, Arkansas, Iowa, North Dakota, South Dakota, Alaska, New Hampshire, Wyoming, and five additional private entities (the “Coalition”) filed suit in the 8th U.S. Circuit Court of Appeals arguing that the power to compel vaccinations rests not with the federal government, but with the states. The Coalition argues that OSHA’s ETS goes beyond workplace safety and into public health policy, which the states assert exceeds OSHA’s statutory authority. Lawsuits filed by Texas, Louisiana, Mississippi, South Carolina, and Utah in the 5th U.S. Circuit Court of Appeals, Florida, Alabama, and Georgia in the 11th U.S. Circuit Court of Appeals, and Kentucky, Idaho, Kansas, Ohio, Oklahoma, Tennessee, and West Virginia filed in the 6th U.S. Circuit Court of Appeals similarly challenge the legality of the OSHA ETS. Kentucky, Ohio and Tennessee also filed suit challenging the Biden Administration’s mandate requiring federal contractors to be vaccinated. The lawsuit sets forth similar bases to challenge the federal contractor mandate, alleging that the police power to enforce vaccines rests with the states, not the federal government. Likewise, the states assert that the federal contractor mandate exceeds the President’s statutory authority. Polsinelli will continue to monitor these lawsuits. Contact your Polsinelli attorney if you have any questions regarding the mandates at issue and/or the impact of the lawsuits on your business.

Today, November 4, 2021, the Occupational Safety and Health Administration (OSHA) issued the emergency temporary standard regarding COVID-19 Vaccination and Testing (the “ETS”) previously unveiled in President Biden’s COVID-19 Action Plan.  Employers with a total of 100 or more employees firm- or corporate-wide at any time the ETS is in place are bound by the requirements established in the ETS. The ETS does not cover workplaces that are subject to the Safer Workforce Task Force COVID-19 Workplace Safety: Guidance for Federal Contractors and Subcontractors or in settings subject to the OSHA Healthcare ETS. The ETS explicitly preempts state and local laws. The ETS establishes minimum vaccination, vaccination verification, face covering, and testing requirements to address COVID-19 in the workplace. The key requirements of the ETS are: Develop a policy for vaccination – Covered employers must develop, implement, and enforce a mandatory COVID-19 vaccination policy. Employers may elect to implement a policy allowing employees to not be vaccinated, but instead be tested weekly for COVID-19 and to wear a face covering at work. Support employees choosing to get vaccinated – Employers must provide employees reasonable time, up to four (4) hours of paid time, to get vaccinated (this applies to both doses). The ETS also requires reasonable time and paid sick leave for employees to recover from any side effects they may experience from the vaccine. Unvaccinated employees must be tested – Employers must ensure that each employee who is not fully vaccinated is tested at least weekly for COVID-19 (if the employee is in the workplace once a week) or within seven (7) days before returning to work (if away from the workplace for a week or longer). Employers are not required to pay for any costs associated with testing. However, employers may be required to pay for testing under other laws, regulations, or agreements. Employees must notify their employer of a positive test – Employers must require their employees to notify them promptly after receiving a positive COVID-19 test result or diagnosis. Employers must immediately remove any employee who tests positive or is diagnosed with COVID-19, regardless of vaccination status. Employers must require employees who test positive or are diagnosed with COVID-19 to remain out of the workplace until they have met the criteria for returning to work. The ETS does not require employers to pay employees who are removed from work due to testing positive or being diagnosed with COVID-19. Face coverings – Employers must require employees who are not fully vaccinated to wear a face covering when indoors or when operating a vehicle with another person. Any employee who elects to wear a face covering must be allowed to do so. Provide information to employees – Employers must provide information at a readily understandable level to their employees concerning:  the requirements of the ETS and workplace policies and procedures established to implement the ETS, the CDC document “Key Things to Know About COVID-19 Vaccines”, information about protections against retaliation and discrimination, and information about laws that impose criminal penalties for knowingly supplying false statements or documents. A more in-depth analysis of the ETS is available, please email polsinellimarketing@polsinelli.com for more details. For additional CMS information read our latest blog post, CMS Mandates Vaccines for Staff of Medicare and Medicaid Providers and Suppliers. Join us for our upcoming webinar, in which we will discuss federal and state-specific vaccine mandates, exemptions and paths for navigation and implementation: Managing Vaccine Mandates and Exemptions. Tuesday, November 16 | 11:00 AM - 12:15 PM CT Click here to register.

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.

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.

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.

On September 11, 2020, the United States Department of Labor (DOL) issued revisions to the Rule implementing the Families First Coronavirus Response Act (FFCRA) to clarify workers’ rights and employers’ responsibilities regarding FFCRA paid leave.  The revised Rule will take effect on September 16, 2020. The Ruling The revised Rule is the DOL’s response to a ruling entered on August 3, 2020, by the United States District Court for the Southern District of New York (District Court) in a lawsuit filed by the State of New York challenging certain provisions of the Rule.  As previously reported, the District Court granted partial summary judgment in favor of the State of New York and ruled that four parts of the Rule were invalid:  (1) the requirement that paid sick leave and expanded family and medical leave are available only if an employee has work from which to take leave (the “work-availability requirement”); (2) the definition of “health care provider” for purposes of the “health care provider or emergency responder” exemption; (3) the requirement that an employer consent in order for an employee to take intermittent leave under the FFCRA; and (4) the requirement that an employee submit documentation to their employer as a pre-condition to leave.  Following the District Court’s ruling, employers in New York faced uncertainty as they evaluated whether and how to apply the FFCRA. The Revised Rule In recognition of the “pressing need for clarity in light of the District Court’s decision,” the DOL issued the revised Rule “to reaffirm its regulations in part, revise its regulations in part, and further explain its positions.” Work-Availability Requirement The revised Rule first reaffirms the work-availability requirement, explaining that an employee may only take paid sick leave or expanded family and medical leave under the FFCRA to the extent that any qualifying reason is a but-for cause of his or her inability to work.  Thus, if an employer has no work for the employee to perform, the employee is not entitled to paid sick leave or expanded family and medical leave under the FFCRA. Employer Approval for Intermittent Leave Likewise, the revised Rule reaffirms that employer approval is needed to take intermittent FFCRA leave in all situations in which intermittent FFCRA leave is permitted.  On this point, the DOL explained that the employer-approval condition balances the employee’s need for leave with the employer’s interest in avoiding disruptions to operations. According to the DOL, the employer-approval condition allows both employers and employees flexibility in agreeing upon telework and scheduling arrangements that may reduce or even eliminate an employee’s need for FFCRA leave by reorganizing work time to accommodate the employee’s needs related to COVID-19. The Definition of “Health Care Provider” With regard to the definition of “health care provider” for purposes of the “health care provider or emergency responder” exemption, the revised Rule adopts an amended regulatory definition including: (1) the FMLA definition of “health care provider” (any employee who is a health care provider under 29 CFR 825.102 and 825.125), and (2) any other employee who is capable of providing health care services, meaning he or she is employed to provide diagnostic services, preventive services, treatment services, or other services that are integrated and necessary to the provision of patient care and, if not provided, would adversely impact patient care. While the DOL’s expanded definition of “health care provider” is broader in scope than the classic FMLA definition of “health care provider,” the DOL made clear that it is not enough that an employee works for an entity that provides health care services.  Certainly the revised definition includes nurses, nurse assistants, medical technicians, and any other persons who directly provide patient services, and would also include individuals whose work impacts diagnostic, preventative, and treatment services, such as lab technicians.  Other employees covered by the revised definition include those who provide services that if not provided would adversely affect patient care.  The Supplementary Explanation that precedes the revised Rule explains that examples include, individuals who bathe, dress, hand feed, or take vital signs of patients, individuals who set up equipment for medical procedures, and individuals who transport patients and samples.  The DOL also provided a non-exhaustive list of employees who are excluded from the definition of “health care provider,” including IT employees, building maintenance staff, human resources personnel, cooks, food services workers, records managers, and billers.  According to the DOL, the services provided by these employees may be related to patient care but they are too attenuated to be integrated and necessary components of patient care.  As such, healthcare employers should immediately evaluate the revised Rule and its impact on their leave decisions. Timing of FFCRA Documentation Finally, the revised Rule clarifies that an employee is not required to submit documentation concerning the need for leave prior to taking paid sick leave or expanded family and medical leave, but rather should submit documentation as soon as practicable.  The DOL notes that in most cases, the requirement to submit documentation will be when the employee provides notice of the employee’s need for leave.  However, when the need for expanded family and medical leave is foreseeable, such as when an employee receives advance notice of a school closure, the employee is likewise required to provide notice as soon as practicable, which would occur before taking leave. Updated FAQs In addition to issuing the revised Final Rule on September 11, 2020, the DOL updated its FAQs to reflect its new guidance concerning the application of the FFCRA. Next Steps for Employers It is yet to be determined whether the revised Rule will satisfy the concerns addressed in the District Court’s ruling, or whether the DOL will face additional challenges by the State of New York or other jurisdictions.  Regardless, employers should apply the FFCRA consistent with the revised Rule and should consult counsel with any questions.  Importantly, health care employers who may have exempted some or all of their employees from the FFCRA based on the DOL’s prior definition of “health care provider” for purposes of the “health care provider or emergency responder” exemption should consult with counsel to determine the new scope of exempted employees and the proper path forward for their organization.

On April 1, 2020, the United States Department of Labor (DOL) issued a Final Rule implementing the Families First Coronavirus Response Act (FFCRA).  Shortly thereafter, the State of New York filed suit against the DOL, arguing that several features of the Final Rule exceeded the DOL’s authority under the FFCRA. Yesterday, the United States District Court for the Southern District of New York granted partial summary judgment in favor of the State of New York and “vacated” four aspects of the Final Rule. Specifically: (1) the “work-availability requirement”; (2) the definition of “health care provider” for purposes of the “health care provider or emergency responder” exemption; (3) the requirement that an employer consent in order for an employee to take intermittent leave under the FFCRA; and (4) the requirement that an employee submit documentation to their employer as a pre-condition to leave. The Court’s ruling could have a significant impact on how FFCRA leave is administered in New York, and potentially across the Country if other states follow in New York’s footsteps. First, without the “work-availability requirement,” an employee is entitled to paid FFCRA leave even if an employer is temporarily closed or they are placed on furlough because the employer does not have work.  The Court analogized a furloughed employee to a teacher on paid parental leave who would still be considered to be on “leave” even if school is called off for a snow day. Although the Court invalidated the requirement, on this issue the Court acknowledged that the statutory language on this point was ambiguous, and that the DOL has the authority to issue guidance on the matter.  Further, while the Court held that the DOL’s “barebones explanation for the work-availability requirement is patently deficient,” it did not find that the conclusion was inconsistent with the statute.  As a result, even leaving aside the possibility of a different outcome on appeal, the DOL may be able to address the Court’s concern through a more thoroughly reasoned explanation of its interpretation. Second, the Court’s Order dramatically narrows the scope of the “health care provider or emergency responder” exemption, which allows an employer of an employee who is a health care provider or emergency responder to exclude the employee from taking leave under the FFCRA.  The DOL’s Final Rule defined a “health care provider” much more broadly than the statute as: anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, pharmacy, or any similar institution, Employer, or entity.  This includes any permanent or temporary institution, facility, location, or site where medical services are provided that are similar to such institutions. The DOL’s broad definition provided many health care related employers the option to apply the exemption to virtually all of their employees. By vacating the Final Rule’s definition of “health care provider,” the only positions clearly included within the definition are those identified in the Family and Medical Leave Act’s (FMLA) definition of “health care provider,” which is limited to “a doctor of medicine or osteopathy who is authorized to practice medicine or surgery (as appropriate)” or “any other person determined by the Secretary to be capable of providing health care services.” (A listing of those other persons is available here).  In rejecting the DOL’s definition, the Court acknowledged that the DOL, though the Secretary of Labor, has authority to expand the definition of the term beyond what is set forth in the statute.  However, it required that there be “at least a minimally role-specific determination” with respect to the application of the exemption.  As a result, even absent an effective appeal, the DOL could take steps to refine this definition, in which case it will be more likely to receive deference from a reviewing court. The Final Rule permits employees to take FFCRA leave intermittently only if the employer and employee agree, and even then, only for a subset of qualifying reasons where there is a minimal risk that the employee will spread COVID-19 to other employees. On this point, the Court agreed with the limitation on the reasons for which employees may take intermittent leave but vacated the requirement that an employer must consent to intermittent leave. Accordingly, the ruling would not require employers to grant intermittent leave when there is a risk of spreading COVID-19 to other employees. However, this decision indicates that employers who do not currently permit intermittent leave under circumstances where there is not a risk of spreading COVID-19 may be at risk if they do not do so going forward. Finally, the Court found that the requirement that an employee submit documentation concerning the need for leave as a condition precedent to taking FFCRA leave was inconsistent with the notice provisions contained in the FFCRA. At this point, it is unclear whether the DOL will move to stay the order pending appeal to the Second Circuit.  What is clear, unfortunately, is that employers are once again faced with uncertainty as they evaluate whether and how to apply the FFCRA.  The Court’s opinion does not apply beyond New York, and it does not mean that the problems with the DOL’s Final Rule cannot be remedied, but employers should take notice and consult with counsel to determine the proper path forward for their organization.

Following a series of local city ordinances aimed at closing the gap left by the Families First Coronavirus Response Act (“FFCRA”), on April 16, 2020, California Governor Gavin Newsom signed into law Executive Order N-51-20, mandating that certain Hiring Entities offer up to 80 hours of “COVID-19 Supplemental Paid Sick Leave” to essential Food Sector Workers, including farm workers, grocery workers, and food delivery workers, who perform work for or through the Hiring Entity.  Here are answers to key questions regarding the new law: Which hiring entities must offer COVID-19 Supplemental Paid Sick Leave? A covered “Hiring Entity” is defined as a private entity, including delivery network companies and transportation network companies, with 500 or more employees nationwide. In determining whether they meet the employee threshold, hiring entities must count full-time employees, part-time employees, employees on leave, temporary employees who are jointly employed by the hiring entity and another employer, day laborers supplied by a temporary placement agency, and all common employees of joint employers or employees of integrated employers.  Although independent contractors should not be counted, contractors may be entitled to leave under the new law (see below).  Finally, employees who have been laid off or furloughed and not subsequently reemployed should not be counted. Who is eligible to take COVID-19 Supplemental Paid Sick Leave? For an individual to be an eligible “Food Sector Worker” they must: Satisfy one of the following three criteria: Works in one of the industries or occupations defined in Industrial Welfare Commission (“IWC”) Wage Orders 3 (Canning, Freezing, and Preserving Industry), 8 (Industries Handling Products After Harvest), 13 (Industries Preparing Agricultural Products for Market, on the Farm) or 14 (Agricultural Occupations); or Works for a Hiring Entity that operates a “food facility,” as defined in Health & Safety Code § 113789(a)-(b) (e.g., restaurants and grocery stores); or Delivers food from a food facility for a Hiring Entity. AND Be an Essential Critical Infrastructure Worker, and therefore, exempt from Executive Order N-33-20 or other statewide stay-at-home orders. AND Leave their residence to perform work for the Hiring Entity. NOTE: The new law appears to apply not just to employees but also contractors and “gig economy” workers.  The law conspicuously avoids the use of the terms “employer” and “employee,” and specifically provides that for purposes of all applicable Labor Code sections, all Food Sector Workers shall be considered “employees” and any Hiring Entity shall be considered an “employer.” What are the qualifying reasons for taking COVID-19 Supplemental Paid Sick Leave? To take COVID-19 Supplemental Paid Sick Leave, a Food Sector Worker must experience one of the following qualifying events: The Food Sector Worker is subject to a Federal, State or local quarantine or isolation order related to COVID-19; or The Food Sector Worker is advised by a health care provider to self-quarantine or self-isolate due to concerns related to COVID-19; or The Food Sector Worker is prohibited from working by the Hiring Entity due to health concerns related to the potential transmission of COVID-19. Hiring Entities must immediately grant leave upon the oral or written request of an eligible Food Sector Worker. How much sick leave must be provided to eligible Food Sector Workers under the new law? Full-time Food Sector Workers can take up to 80 hours of paid sick leave, including workers who worked or were scheduled to work, on average, at least 40 hours per week in the two weeks preceding the date they take the leave; Part-time Food Sector Workers with a normal weekly schedule can take up to the total number of hours they are normally scheduled to work in a two week span; Part-time Food Sector Workers with a variable schedule can take up to 14 times the average number of hours worked each day in the six (6) months preceding the date the worker takes the leave.  If the worker has worked less than six (6) months, the calculation should be based on the entire period the individual worked for or through the Hiring Entity. COVID-19 Supplemental Paid Sick Leave should be paid out at a rate equal to the highest of the worker’s: (1) regular rate of pay for their last pay period; (2) the state minimum wage; or (3) the local minimum wage.  The total amount paid per day is capped at $511 and no more than $5,110 in the aggregate. When is the program effective? The law is effective as of April 16, 2020 and will be effective during the pendency of any statewide stay-at-home orders issued by the State Public Health Officer.  However, if a Food Sector Worker is taking COIVD-19 Supplemental Paid Sick Leave at the time of the expiration of all applicable orders, the worker may still take their full amount of leave. How does this program interact with the FFCRA and other forms of leave? It does not interact with the FFCRA. This ordinance only impacts Hiring Entities with greater than 500 workers in aggregate.  The FFCRA only applies to employers with fewer than 500 workers in aggregate.  Regardless, the two leaves would run concurrently. However, COVID-19 Supplemental Paid Sick Leave is in addition to any paid sick leave available under California’s paid sick leave law set forth in Labor Code section 246.  Moreover, a Hiring Entity may not require a Food Sector Worker to use any other paid or unpaid leave, paid time off or vacation time before the worker uses their COVID-19 Supplemental Paid Sick Leave. Is a Hiring Entity exempt if it already provides paid leave for these same reasons? A Hiring Entity is not required to provide a Food Sector Worker with COVID-19 Supplemental Paid Sick Leave if, as of April 16, 2020, the Hiring Entity provides the worker with a “supplemental benefit,” such as paid leave, for the same reasons and in an equal or greater amount as that afforded under the new law. What happens if a Hiring Entity does not comply with the new law? The new law expressly authorizes the Labor Commissioner to enforce the COVID-19 Supplemental Paid Sick Leave, leave which shall be considered “paid sick days” and enforced accordingly under Labor Code sections 246(n), 246.5(b)-(c), 247, 247.5 and 248.5.  Any Food Sector Worker denied COVID-19 Supplemental Paid Sick Leave can file a claim with the Labor Commissioner pursuant to Labor Code sections 98 or 98.7. A Food Sector Worker can also pursue any other remedies provided by state or local laws, including Business & Professions Code section 17200. Do covered entities need to provide notice of the new law? Yes, Hiring Entities must display a poster in a conspicuous place regarding the rights afforded under the new law, in compliance with Labor Code section 247.  The Labor Commissioner has made available a model notice for purposes of complying with this obligation.  If a Hiring Entity’s Food Sector Workers do not frequent a physical workplace, the Hiring Entity may disseminate notice through e-mail or other electronic means. Are there any other requirements under the new law? In addition to the paid sick leave requirements discussed above, the Executive Order expressly provides that Food Sector Workers working in any food facility shall be permitted to wash their hands every 30 minutes and additionally as needed.  This requirement is to be enforced pursuant to applicable provisions of the Retail Food Code. For questions relating to this new California COVID-19 Supplemental Paid Sick Leave, please do not hesitate to reach out to a Polsinelli attorney.

On April 1, 2020, the Wage and Hour Division of the Department of Labor (“DOL”) issued temporary regulations (“Regulations”) to implement the Public Health Emergency Leave (“Emergency FMLA Leave”) and Emergency Paid Sick Leave (“Paid Sick Leave”) benefits available under the Families First Coronavirus Response Act (“the “Act”). The Regulations took immediate effect, on the effective date of the Act, and remain in effect through December 31, 2020, when the Act expires. The Regulations expand on the DOL’s guidance or “Families First Coronavirus Response Act: Questions and Answers,” which were issued late the week of March 23 and updated over the following weekend.  In some instances, the Regulations are inconsistent with the DOL’s former guidance – particularly with regard to: (1) The reasons an employee may take Paid Sick Leave, (2) The applicability of the integrated employer and joint employer tests which are used to determine the number of employees for purposes of coverage under the Act, and (3) The documentation employers may request to determine an employee’s eligibility for leave under the Act. The DOL updated its previous guidance or Questions and Answers on April 1, 2020 (here), to conform to the Regulations. A brief summary of several sections that (1) depart from the DOL’s former guidance or (2) provide new information the DOL did not previously address is below. Government Orders The Regulations expand the qualifying reasons for Paid Sick Leave to include containment, shelter-in-place and stay-at-home orders.  However, an employee is only entitled to Paid Sick Leave if the order “cause[s] the Employee to be unable to work even though his or her Employer has work that the Employee could perform but for the order.” Significantly, the Regulations further broaden “Subject to a Quarantine or Isolation Order” to include: when a Federal, State, or local government authority has advised categories of citizens (e.g., of certain age ranges or of certain medical conditions) to shelter in place, stay at home, isolate, or quarantine, causing those categories of Employees to be unable to work even though their Employers have work for them. Advice to Self-Quarantine The Regulations state that an employee has been “advised by a health care provider to self-quarantine due to COVID-19 concerns” for purposes of Paid Sick Leave if: (i) A health care provider advises the Employee to self-quarantine based on a belief that— (A) the Employee has COVID-19; (B) the Employee may have COVID-19; or (C) the Employee is particularly vulnerable to COVID-19; and (ii) following the advice of a health care provider to self-quarantine prevents the Employee from being able to work, either at the Employee’s normal workplace or by Telework. Similarly, the Regulations provide that an employee may take Paid Sick Leave to care for another who has received any of the same recommendations.  On that point, the Regulations explain that to qualify for Paid Sick Leave, the other person must be: an Employee’s immediate family member, a person who regularly resides in the Employee’s home, or a similar person with whom the Employee has a relationship that creates an expectation that the Employee would care for the person if he or she were quarantined or self-quarantined. For this purpose, ‘individual’ does not include persons with whom the Employee has no personal relationship. Seeking a Diagnosis With respect to people who suspect that they are ill, the Regulations clarify that if an employee is taking leave because they are “experiencing COVID-19 symptoms and seeking medical diagnosis,” the employee’s Paid Sick Leave “is limited to the time the Employee is unable to work because the Employee is taking affirmative steps to obtain a medical diagnosis, such as making, waiting for, or attending an appointment for a test.” Employer Coverage The Regulations provide that all common employees of joint employers or all employees of integrated employers must be counted together to determine coverage under the Act.  We have covered this issue in more detail here. Notice of Need for Leave and Documentation of Need for Leave The Regulations regarding documentation of the need for leave are a departure from the DOL’s former guidance, which suggested that an employer could require a variety of documents with a request for Paid Sick Leave or Emergency FMLA Leave.  The Regulations provide that an employer may not require a notice of the need for leave to include documentation beyond what is listed below. Before taking either Paid Sick Leave or Emergency FMLA Leave, all employees must give their employers documentation that includes: (1)  The employee’s name; (2)  The date(s) for which leave is requested; (3)  The qualifying reason for the leave; and (4)   A written or oral statement that the employee is unable to work because of the qualifying reason for leave. Before taking a Paid Sick Leave or Emergency FMLA Leave, some employees must additionally provide: o   For an employee subject to a federal, state or local quarantine or isolation order related to COVID-19: the name of the government entity that issued the Quarantine or Isolation Order o   For an employee advised by a health care provider to self-quarantine due to COVID-19 concerns: the name of the health care provider who advised the employee to self-quarantine due to concerns related to COVID-19. o   For an employee caring for an individual subject to a federal, state or local quarantine or isolation order or a health care provider’s advice to self-quarantine due to COVID-19 concerns: either (a) the name of the government entity that issued the Quarantine or Isolation Order to which the individual being cared for is subject or (b) the name of the health care provider who advised the individual being cared for to self-quarantine due to concerns related to COVID-19. o   For an employee caring for the employee’s child whose school or place of care is closed or the child’s care provider is unavailable due to a public health emergency) or Emergency FMLA Leave: the name of the employee’s child (or children), the name of the closed or unavailable school or child care provider, and a representation that no other suitable person will care for the employee’s child when the employee takes Paid Sick Leave or Emergency FMLA Leave. In addition to the information specifically identified, the Regulations generally state that an employer may request that an employee provide additional material as needed to support the employer’s request for tax credits pursuant to the Act.  And, the Regulations state that employers are not required to provide an employee’s request for leave if the employee fails to provide materials sufficient to support the applicable tax credit.  With respect to documents required for tax credits, the Regulations refer to https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs (“IRS FAQs”) for more information. Significantly, neither the Regulations nor the IRS FAQs specify any additional information employees must provide an employer to take Paid Sick Leave based on experiencing COVID-19 symptoms and seeking medical diagnosis or for employees experiencing any other substantially similar condition specified by the federal government. While the Regulations answer questions about the process of requesting leave under the Act, the Regulations leave open questions about: Whether employers can require additional documentation substantiating the need for leave after a Paid Sick Leave or Emergency FMLA Leave is approved. Whether the DOL will issue additional Regulations or the IRS will issue additional guidance on the documentation process in the coming weeks. Recordkeeping Finally, under the Regulations, an employer must: Retain all documentation related to an employee’s request for or entitlement to Paid Sick Leave or Emergency FMLA Leave for four years, regardless of whether the leave was granted or denied. Document and keep any oral statements an employee provided to support a request for Paid Sick Leave or Emergency FMLA Leave for four years. Have an authorized officer document that the employer is eligible for the small employer exemption to the Act when the employer denies an employee’s request for Paid Sick Leave or Emergency FMLA Leave (and keep such documentation for four years). Notably, the Regulations provide that a small employer must post a notice regarding the Act, even if the employer determines that it is exempt.

On March 18, 2020, President Trump signed the Families First Coronavirus Response Act (the “Act”), requiring employers with fewer than 500 employees to provide paid leave benefits related to the COVID-19 pandemic under the Emergency Family and Medical Leave Expansion Act (“Paid FMLA Leave”) and Emergency Paid Sick Leave Act (“Paid Sick Leave”). The details of the Act are set out in our earlier Blog post here. Since the Act was passed, there has been much discussion about how employees across related companies should be counted for purposes of coverage. Today, the Wage and Hour Division of the Department of Labor issued a “temporary regulation” or rule that clarifies this issue, which can be found here.[i]  The temporary rule remains in effect through December 31, 2020 when these provisions sunset.  In evaluating this issue, it is important to note that the two leave requirements arise in different portions of the Act. The right to Paid FMLA Leave is set forth in Division C of the Act, which amends the existing statutory text of the Family and Medical Leave Act (“FMLA”). The right to Paid Sick Leave is set forth in Division E of the Act. While both Divisions of the Act set the threshold for covered employers at “fewer than 500 employees,” neither provides express direction on how this number should be calculated across related entities. Today’s rule specifically addresses this issue. Pursuant to § 826.40 of the rule, which addresses issues related to employer coverage, aggregation of employees will occur in relation to both benefits when an employer meets either the “Integrated Employer” or “Joint Employer” tests. As a general matter, the legal entity which employs the employee is the “employer.” Where one corporation has an ownership interest in another corporation, it is a separate employer unless it is an “Integrated Employer” or a “Joint Employer.”[ii] To determine whether separate entities are considered an “Integrated Employer,” the Department of Labor considers “the entire relationship” between the parties “reviewed in its totality” based on the following four factors: (i) Whether there is common management; (ii) Whether the entities’ operations are interrelated; (iii) Whether there is centralized control of labor relations; and (iv) The degree of common ownership/financial control of the entities. If the factors indicate the entities are an Integrated Employer, the employees of all entities making up the Integrated Employer are counted to determine employer coverage and eligibility for Paid Sick Leave and Paid FMLA Leave. Even if separate entities are not considered an Integrated Employer, the Department of Labor may consider separate entities a “Joint Employer” if the entities each exercise some control over the work or working conditions of an employee. Notably, the joint employer test does not require common ownership. Joint employers may be separate and distinct entities with separate owners, managers, and facilities. Nevertheless, if an employee performs work that simultaneously benefits two or more employers, or works for two or more employers at different times during the workweek, the separate entities may be considered a Joint Employer. To evaluate whether an employee’s work simultaneously benefits two employers, the DOL applies a four-factor balancing test assessing whether the potential joint employer: (i) Hires or fires the employee; (ii) Supervises and controls the employee’s work schedule or conditions of employment                              to a substantial degree; (iii) Determines the employee’s rate and method of payment; and (iv) Maintains the employee’s employment records. The potential joint employer must actually exercise—directly or indirectly—one or more of these indicia of control to be jointly liable under the Act; however the potential joint employer’s maintenance of the employee’s employment records alone will not lead to a finding of joint employer status.  DOL guidance on the Joint Employer test can be found here. If two entities are found to be joint employers, all of their common employees must be counted in determining whether the Paid Sick Leave and Paid FMLA Leave obligations apply. Employers should exercise caution in oversimplifying the Integrated Employer and Joint Employer analyses to avoid coverage under the Act. An employer who takes the position that they are an Integrated Employer or Joint Employer for purposes of avoiding coverage under the Act may later find they waived their ability to assert they are separate entities in litigation or other disputes. Employers are encouraged to consult with counsel to determine coverage under the Act. [i] This rule is different from guidance the DOL provided recently in the form of FAQs. [ii] 29 CFR 825.104(c)(1).

On July 13, 2018, the U.S. Department of Labor (“DOL”) issued a Field Assistance Bulletin (“FAB”) to provide guidance to field-office staff regarding whether caregivers, such as nurses and health aides, qualify under the Fair Labor Standards Act (“FLSA”) as employees of registries that connect caregivers with people who need their services, such as senior citizens or individuals with disabilities and/or certain medical conditions, or are independent contractors. The majority of the FAB summarizes previous guidelines issued by the DOL, such as Conducting a background check and/or verifying references and credentials, does not make a caregiver an employee of the registry.  Note, however, that screening for subjective characteristics, such as likeability, would indicate an employment relationship. Facilitating matches between clients and caregivers based on their parameters and preferences does not establish an employment relationship, so long as the registry does not maintain control over hiring and firing of the caregiver. Facilitating communication between clients and caregivers is acceptable and does not create an employment relationship, so long as the registry does not directly assign specific caregivers based on subjective factors (i.e., likeability). Allowing the caregiver unrestrained profit/loss opportunities (e.g., no maximum number of hours, no limitations on the engagement in other ventures, etc.) tends to show that there is not an employment relationship. Informing the client or caregiver about normal pay rates in the area is not sufficient to create an employment relationship, nor is relaying communications on preferred rates of pay. However, the below factors are indicative of an employment relationship between a registry and a caregiver: The registry maintains the ability to hire or fire a caregiver. Taking extra steps to evaluate “subjective factors that the registry values” rather than “performing basic quality control and verification checks” such as consideration as to whether a prospective caregiver is a likeable person or interviewing the caregiver’s references. Charging “fees that fluctuate based on the number of hours that a caregiver works” for the client indicates an “ongoing interest in the employment relationship, including in the number of hours the caregiver works and whether those hours are tracked accurately.” This type of fee arrangement “may indicate that the registry is the caregiver’s employer.” Conversely, if the fees are issued on an initial basis, as well as “per service” fees for administrative activities, rather than on an hourly basis, it is more likely the parties have entered into an independent contractor relationship. Requiring the creation and confirmation of a caregiver’s hours worked may indicate the existence of an employment relationship. Mandating how services must be provided. Critically, “the analysis does not depend on any single factor” and the Wage and Hour Division of the DOL “will consider the totality of the circumstances to evaluate whether an employment relationship exists between a registry and a caregiver.” As we have previously reported, the standards governing employment and independent contractor classification are constantly changing.  Businesses, especially in labor intensive industries and the sharing economy, should closely track these standards and consult competent counsel with any questions.  We will track how the FAB affects future DOL Wage & Hour investigations and whether it is cited persuasively by courts interpreting the FLSA.

Employers face a host of compliance challenges under state and federal law when an employee suffers a workplace injury.  As we recently reported, employers must consider the legal implications of the Family and Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA) when litigating workers’ compensation claims.  Employers should also be cognizant of their obligations under the Occupational Health and Safety Act (OSHA) and the Genetic Information Nondiscrimination Act (GINA). Workers’ Compensation and the FMLA Generally, state workers’ compensation laws require the provision of benefits to employees who sustain relatively minor, temporary job-related injuries as well as for permanently disabling serious injuries.  Additionally, the FMLA provides eligible employees with up to twelve weeks of unpaid, job-protected leave per year.  Eligible employees may take leave under the FMLA to care for a spouse, child or parent who has a serious health condition or because of their own serious health condition.  Under the FMLA, a “serious health condition” includes an illness, injury, impairment, and physical or mental condition involving inpatient care in a hospital, hospice, or residential medical care facility or continuing treatment by a health care provider.  Thus, a workplace injury or illness that qualifies as a serious health condition may entitle an eligible employee to FMLA leave. Workers’ Compensation and the ADA The ADA prohibits employers from discriminating against qualified individuals because of their disability.  The ADA defines a disability as (1) a physical or mental impairment that substantially limits a major life activity, (2) a record of such an impairment, or (3) being regarded as having such an impairment.  If an employee suffers a workplace injury that qualifies as a serious health condition and meets the ADA’s definition of an individual with a disability, the ADA, FMLA, and state workers’ compensation laws are implicated, and the employee could be entitled to job-protected leave and may also require a workplace accommodation. OSHA and GINA OSHA requires employers to provide a safe and healthful workplace to employees.  Among other obligations, OSHA requires employers to timely report and keep records of work-related injuries and illnesses.  In addition, employers are prohibited from discharging, retaliating or discriminating against any employee because the employee has exercised rights under OSHA. Finally, GINA prohibits employers from discriminating on the basis of genetic information.  Among other obligations, GINA requires employers who seek medical certifications in support of leave or accommodation requests- including FMLA leave- to affirmatively notify employees of GINA’s limitations on requests for genetic information. In light of the interplay between state workers’ compensation laws, the FMLA, ADA, OSHA, and GINA, employers should pro-actively evaluate and manage their workers’ compensation, FMLA, and ADA issues concurrently at the time of an employee’s injury, while an employee is on leave due to a workplace injury or illness, and after an employee has exhausted any leave or workers’ compensation benefits to ensure compliance with OSHA and GINA.

Recently, we reported that the “new” National Labor Relations Board (“NLRB” or the “Board”) has commenced the anticipated roll back of decisions and procedures rendered by the Obama Administration’s NLRB. On Friday, December 15, 2017, the NLRB issued another important decision with far-reaching implications for all employers. In Boeing Company, 365 NLRB No. 154 (2017), the NLRB established a new standard for evaluating whether workplace rules, policies, or employee handbook provisions unlawfully interfere with employees’ exercise of rights under Section 7 of the National Labor Relations Act (“NLRA”). Under the new standard established in Boeing, the NLRB will balance the impact an employer’s proffered rule may have upon an employee’s Section 7 rights to engage in protected concerted activity against the employer’s business justification for the rule. The NLRB indicated it would categorize the results of future decisions in three ways: Category 1 will include rules the NLRB designates as lawful because (i) the rule, when “reasonably interpreted,” does not prohibit or interfere with the exercise of Section 7 rights; or (ii) the potential adverse impact on protected rights is outweighed by the employer’s business justification(s) for the rule. Category 2 will include rules warranting individual scrutiny on a case-by-case basis as to whether the rule would prohibit or interfere with Section 7 rights, and if so, whether any adverse impact on employees’ protected conduct is outweighed by legitimate justifications. Category 3 will include rules that the NLRB will designate as unlawful because they would prohibit or limit NLRA-protected conduct, and the adverse impact on employees’ Section 7 rights is not outweighed by legitimate business justifications. The Board specifically identified employer policies that would prohibit employees from discussing wages or benefits with each other as an example for this third category. The three categories identified by the NLRB represent a classification of results from the NLRB’s application of the new test and are not part of the test itself. The NLRB will determine in future cases the types of additional rules that fall into each category. The new balancing test established in Boeing Company overrules the “reasonably construe” standard in place since 2004. Under the “reasonably construe” standard, the NLRB could conclude that a proffered work rule violated the NLRA so long as an employee could “reasonably construe” the rule to interfere with their Section 7 rights. The Board’s new balancing test seeks to provide employees, employers and unions with greater clarity and certainty. While it will take time to determine the full impact of the Boeing decision, the fact that the new balancing standard requires the NLRB to consider the business purpose of a rule is a remarkable shift in the Board’s evaluation of workplace rules, policies and employee handbook provisions. In light of the new balancing test, employers should consider clearly articulating the business justification(s) for workplace rules, policies, and procedures, particularly those that could conceivably implicate rights arising under Section 7 of the NLRA.

School’s out for summer. While some students will sit by the pool, others are seeking summer employment. Youth employment may provide a relatively simple and cost-effective resource that can help fill seasonal staffing needs. However, employers should be mindful of federal and state laws that regulate the employment of minors (generally individuals under 18 years of age) to avoid being subject to considerable penalties. For instance, the Fair Labor Standards Act (“FLSA”) sets federal wage, hours worked, and safety requirements for minors. The regulations vary based on the minor’s age and the particular job involved. Generally, the FLSA provides: Minors under 14 years of age can only be employed in certain jobs such as babysitting on a casual basis, working for a parent, or delivering newspapers; Minors ages 14 to 15 can only work a limited number of hours outside of school time in certain jobs including, but not limited to, retail occupations, errands or delivery work, and work in connection with cars and trucks such as dispensing gasoline or oil and washing or hand polishing. Minors ages 14 to 15 must be paid at least the federal minimum wage; and Minors ages 16 to 17 may work unlimited hours in any nonhazardous occupation and must be paid at least the federal minimum wage. Additionally, many states regulate the employment of minors, and employers are required to comply with both state and federal law. In instances where state law provides more stringent protections than the FLSA, the employer must adhere to the state law to ensure compliance. Finally, the Occupational Safety and Health Act (“OSHA”) provides that employers of minors must: Ensure that minors receive training to recognize hazards and are competent in safe work practices. Training should be in a language and vocabulary that minors can understand and must include prevention of fires, accidents, and violent situations and what to do if injured. Implement a mentoring or buddy system for minors. Have an adult or experienced young worker answer questions and help the new minor employee learn the ropes of a new job. Encourage minors to ask questions about tasks or procedures that are unclear or not understood. Tell them whom to ask. Remember that minors are not just "little adults." Employers should be mindful of the unique aspects of communicating with minors. Ensure that equipment operated by minors is both legal and safe for them to use. Employers must label equipment that minors are not allowed to operate. Tell minors what to do if they are injured on the job. In light of the various regulations surrounding youth employment, employers should consider the following best practices: Consider requesting age certificates from minors as a document for proof of age. Implement training directed to minor employees regarding safety, emergency, and workplace standards. What may be obvious to an adult employee may not be clear to a minor employee entering the workforce for the first time. Clearly communicate workplace policies, practices, and procedures. Ensure minor employees are completing tasks safely. Once a minor employee demonstrates that they can complete a task safely, check again later to be sure they are continuing to do so.

On February 28, 2017, the Missouri Supreme Court issued its long-awaited opinion in Cooperative Home Care, Inc., et al. v. City of St. Louis, Missouri, et al., ruling that the City of St. Louis can proceed with a citywide local minimum wage increase under Ordinance 70078 of its revised city code (the “Ordinance”). The Ordinance provides a series of four graduated increases to the minimum wage for employers with employees working within the physical boundaries of the City of St. Louis. Background The Ordinance was enacted by the Board of Aldermen of the City of St. Louis on August 28, 2015.  The Ordinance provides a series of four graduated increases to the minimum wage for employees working within the physical boundaries of St. Louis, which were to be phased in beginning on October 15, 2015 at $8.25 per hour and rising to $11 per hour on January 1, 2018.  In addition, beginning January 1, 2021, the minimum wage rate in St. Louis will increase annually on a percentage basis to reflect the rate of inflation.  The Ordinance further provides: “If the state or federal minimum wage rate is at any time greater than the minimum wage rate established by this ordinance, then the greater shall become the minimum wage rate for purposes of this ordinance.” Shortly after the Ordinance was enacted, business groups in St. Louis filed a Petition seeking (1) a declaratory judgment that the Ordinance was invalid; and (2) injunctive relief to prevent enforcement of the Ordinance.  The business groups alleged that local minimum wage ordinances are preempted by Sections 290.502 and 67.1571 of the Revised Statutes of Missouri (R.S.Mo.) and that the Ordinance exceeds the charter authority granted to the city of St. Louis. Based on principles governing preemption and the Missouri Constitution’s single subject rule, the Court held that state law does not preempt the Ordinance and that the Ordinance is not beyond St. Louis’s charter authority. Looking Forward As set forth above, the minimum wage in St. Louis was scheduled to rise over the course of three years beginning on October 15, 2015.  Under the Ordinance, the minimum wage in St. Louis was scheduled to increase to $10.00 as of January 1, 2017.  While the Ordinance is effective as of the date of the Court’s ruling, Mayor Francis Slay has said he will give businesses a “reasonable grace period” to adjust to the new minimum wage.  Mayor Slay did not specify how long the grace period will last, and the City has not established a new phase-in schedule. Mayor Slay’s director of communications has stated that enforcement of the Ordinance will be complaint-driven.  The City plans to post a complaint form online for employees to alert city officials about employers who are not in compliance with the Ordinance.  Employers who do not comply with the new minimum wage are subject to prosecution in Municipal Court and could have their business license or occupancy permit revoked, in addition to the award to an employee of back wages plus interest from the date of non-payment or underpayment.  Each day that an employer pays an employee a wage below the minimum wage counts as a separate violation.

The Americans with Disabilities Act of 1990 (“ADA”) treats mental illness the same as physical disabilities for purposes of coverage. However, dealing with an employee’s mental health condition can be particularly challenging for employers because the traits that confer protected status are not always visible or otherwise noticeable. An employee’s diagnosis of depression or other mental illness can easily subject a well-meaning employer to potential liability. According to charge data from the Equal Employment Opportunity Commission (“EEOC”), the number of charges of discrimination filed with the EEOC based on mental health conditions are on the rise. During the 2016 fiscal year, the EEOC resolved almost 5,000 charges of discrimination based on mental health conditions, obtaining approximately $20 million for individuals with mental health conditions who were discriminated against based on a disability. The EEOC has responded by issuing a publication on the rights of job applicants and employees with mental health conditionsto raise awareness about the protections the ADA affords individuals with mental health conditions and using its enforcement power to protect individuals with mental health conditions. The EEOC continues to aggressively pursue such cases. For example, on November 30, 2016, the EEOC filed suit against Stevens Transport, Inc. (“Stevens Transport”), alleging that Stevens Transport discriminated against a U.S. Air Force veteran because of his bipolar disorder. Specifically, the EEOC alleges that the individual was a qualified candidate and Stevens Transport unlawfully refused to hire him in violation of the ADA. According to the EEOC’s complaint, the candidate applied to be a commercial truck driver with Stevens Transport. As part of the application process, candidates are required under Federal Motor Carrier Safety Administration (“FMCSA”) regulations to take a physical exam, submit a sample for drug testing, and fill out a medical history questionnaire. The EEOC alleges the candidate was told he could not be hired as a truck driver for Stevens Transport “per company policy” because of the medicine he takes to control his bipolar disorder, even though he presented a report from his medical provider indicating he was safe to drive. However the physician with whom the company contracted to conduct FMCSA-required medical examinations advised that he not be hired because of his medications. Given the rising number of charges of discrimination filed with the EEOC based on mental health conditions, the EEOC’s interest in protecting individuals with mental health conditions, and the challenges posed by mental illnesses, employers should consider the following steps to minimize liability: Remind Managers and Supervisors to involve human resources personnel when employees indicate they may need an accommodation for a mental health condition, and/or exhibit behavior affecting their work such as difficulty concentrating, interacting with others, communicating, eating or sleeping; Document objective concerns regarding an employee’s behavior; and Engage in one-on-one discussions with the employee to determine if the nature of the employee’s mental health condition impacts the employee’s ability to perform the essential functions of their job, with or without an accommodation.

On July 6, 2016, Pokémon Go was released in the United States. Almost overnight, the location-based, augmented reality game became a national, if not global, phenomenon. You cannot turn on the television, listen to the radio, read news headlines, or even walk out your front door without hearing about the game or seeing individuals using their smartphones and tablets to “find” and “capture” digital creatures that virtually appear at specific locations. While Pokémon Go may sound like a harmless, albeit distracting, “video game,” it poses a risk to cyber security and raises concerns about data vulnerability in company databases and systems. Games like Pokémon Go require users to download and install an application on the users’ phones or tablets. Users are not always aware if they have downloaded an infected version of the application, which may allow hackers to spy on the victim’s phones and gain access to their data. Some infected versions of the Pokémon Go application have contained a backdoor called DroidJack. DroidJack gives attackers complete access to mobile devices, including user text messaging, GPS data, phone calls, camera—and any business network resources they access.    Even if an employee does not download an infected version of an application, there are still cyber security concerns. Individuals are often quick to download the latest application to access or share data for games like Pokémon Go, without scrutinizing what they are granting the application access to. In the event of a hack targeting a popular application like Pokémon Go, attackers have the potential to access all the data of application users who have not limited the application’s access to their data, including proprietary business information.   In light of the popularity of games like Pokémon Go and the inevitability that similar games or social media applications will become widespread, employers should take measures to deal with how and where business mobile devices can be used to ensure their proprietary information is not being captured by third parties. Electronic device policies can be very effective in limiting an employer’s cyber security risk where the policy requires employees to refrain from downloading and accessing smartphone apps, websites, programs and files that may pose a security risk if the electronic device is used to connect to sensitive corporate information. Employers should also consider updating electronic device policies to require employees to install company encryption software for protecting sensitive data with an agreement signed by employees to not modify the software.

As many employers are keenly aware, misclassification claims under the Fair Labor Standards Act (“FLSA”) are becoming more prevalent. Employers may face a number of pitfalls that can expose them to potential liability. First, whether or not an employee is “exempt” from overtime payments under the FLSA can be difficult to determine factually, and classification errors can subject employers to wage and hour claims to collect unpaid overtime. Employers of home care workers face an additional hazard under the FLSA: the uncertainty of the law. On October 1, 2013, the Department of Labor (“DOL”) issued the Home Care Final Rule (“Final Rule”) to extend minimum wage and overtime protections to almost 2 million home care workers, by revising the regulations defining companionship services so that many direct care workers are subject to the overtime pay provisions of the FLSA. The Final Rule also revised the DOL’s regulations concerning live-in domestic services workers. The Final Rule had an effective date of January 1, 2015. In June 2014, associations of home care companies filed a lawsuit in federal court challenging the Final Rule. In December 2014 and January 2015, the U.S. District Court for the District of Columbia issued orders vacating and revising certain portions of the Final Rule, thus affecting the applicability of the Final Rule to many employers. The DOL filed an appeal of the orders to the U.S. Court of Appeals for the District of Columbia Circuit. On August 21, 2015, the Court of Appeals issued a unanimous opinion affirming the validity of the Final Rule and reversing the District Court’s orders.  On October 13, 2015, the Court of Appeals’ opinion upholding the Final Rule became effective when the Court of Appeals issued its mandate. On November 24, 2015, the home care associations filed a petition for certiorariwith the U.S. Supreme Court. Given the effect of the pendency of the Final Rule on the DOL’s ability to enforce the Final Rule from the original “effective date” of January 1, 2015 to October 13, 2015, the date the Court of Appeals’ opinion became effective, there is a question as to whether employers affected by the Final Rule were required to follow the Final Rule during that interim period. In Beltran v. InterExchange, Inc., 2016 WL 1253622, No. 14-cv-03074-CMA-KMT (D. Col. Mar. 31, 2016), the U.S. District Court of the District of Colorado recently ruled that domestic service workers had viable claims for overtime for any work performed after January 1, 2015 due to the Final Rule. In contrast, in Foster v. Americare Healthcare Svcs, Inc., 2015 WL 8675518, No. 2:13-cv-658 (S.D. Ohio Dec. 11, 2015),  the U.S. District Court for the Southern District of Ohio held that the Final Rule was not effective until October 13, 2015. Despite the uncertainty of whether the Final Rule was effective as of January 1, 2015 or October 13, 2015, employers with home health workers should take steps to comply with the Final Rule. The DOL has increased its efforts to address wage and hour violations, including the development of a smartphone app to help employees track hours worked. Accordingly, if an employee is considered “non-exempt” in the wake of the Final Rule, it is critical that employers accurately record their time worked to ensure that they are paid overtime for all hours worked over 40 hours in a workweek.

When employers consider potential discrimination claims to avoid, the analysis should not stop with Title VII, the Age Discrimination in Employment Act (“ADEA”) and the Americans with Disabilities Act (“ADA”).  Hiding in plain sight, but not to be overlooked, is ERISA Section 510, 29 U.S.C. § 1140. ERISA Section 510, 29 U.S.C. § 1140, provides: “[i]t shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan . . . or for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan…” ERISA Section 3(7), 29 U.S.C. § 1002(7), defines a “participant” as “any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit.” Discrimination claims under ERISA Section 510 occur most often when an employer has terminated an employee, and the employee claims that the termination was to prevent the employee from making a claim under a benefit plan or becoming eligible for benefits under a benefit plan. Although discrimination claims brought under ERISA Section 510 face different substantive requirements than discrimination claims brought under Title VII, the ADEA, and the ADA, they are similarly analyzed under the familiar McDonnell Douglas three-stage burden-shifting paradigm. To prevail under ERISA Section 510, an employee must prove that the employer’s adverse employment action was taken with the specific intent to interfere with the employee’s rights or benefits under an ERISA plan.  This means that the loss of benefits was the reason behind the adverse employment action, not merely a consequence of the action.  As with other employment discrimination causes of action, if the employee can make an initial showing of a prima facie case for intentional interference, then the employer must come forward  with a legitimate, non-discriminatory basis for their action.  If the employer succeeds, then the ERISA Section 510 plaintiff is “required to present evidence that [an employer] acted with ‘specific intent’ to interfere with their rights” to overcome an employer's legitimate, non-discriminatory reason.  This specific intent can be shown with circumstantial evidence, but must be more specific than mere conjecture. ERISA Section 510 claims have become more prevalent.  Employers contemplating layoffs or terminations of employees with benefits subject to ERISA should consult with counsel to identify and mitigate the risk of ERISA Section 510 claims.

Most employers are keenly aware of the state and federal taxes they must pay to fund unemployment benefits.  Many employers routinely include “no contest” provisions in their separation agreements whereby they agree not to contest unemployment benefit applications.  While a “no contest” provision seems like an easy, no-risk and inexpensive bargaining tool, the inclusion of a “no contest” provision can expose an employer to potential liability. In 2011, Congress passed the Unemployment Insurance Integrity Act (“UI Integrity Act”) to reduce payments of unemployment compensation to ineligible claimants attributed to employer non-responsiveness to unemployment claim notices.  The UI Integrity Act required states to enact laws by October 21, 2013 to (1) enhance penalties for fraudulent unemployment insurance claimants; (2) revise the timing of “new hire” reports; and (3) impose new obligations on employers with respect to responding to unemployment insurance claim notices. States’ responses to the UI Integrity Act have varied.  To date, almost all states, with the exception of Missouri, have successfully enacted legislation to comply with the UI Integrity Act. In states such as Kansas, Texas, South Carolina, Washington and California, employers that have established a “pattern” of failing to timely or adequately respond to unemployment claim notices are penalized. Under the legislation in these states, if an unemployment compensation payment is made to a claimant and it is later determined that the claimant was ineligible, the employer’s unemployment insurance account will be charged with the overpayment if (1) the employer failed to provide an adequate or timely response to the claim that has been deemed an overpayment, and (2) the employer has established a pattern of failing to timely or adequately respond. “Pattern” is defined differently by state. In addition, the legislation in Kansas, Oklahoma, and Washington contain provisions that disqualify an employer from having standing to appeal a determination regarding an unemployment benefits claim if the employer fails to respond to a claim within a certain period. California’s provisions are particularly strict, penalizing willful withholding of information, willful failure to report any relevant information, or willful failure to report a material fact concerning termination. In light of the varying state laws that have been enacted, employers should review and consider revising any standard “no contest” provisions in their separation agreements.  Doing away with language indicating that an employer will “not contest” a claim for unemployment benefits can insulate the employer from liability under the new state laws as well as liability for potential breach of contract claims if a state agency requires the employer to provide additional information that could be construed as opposition to a claim for benefits.