General Updates 2/20/2023

Happy Mardi Gras! Below is an update from a good friend who continues to share important information I wanted to pass along. 

More on IL BIPA

The Illinois Supreme Court ruled recently that the Biometric Information Privacy Act (BIPA) claims accrue each time data is unlawfully collected and disclosed rather than simply the first time. This now means that a claimant has the opportunity to seek a much higher amount of damages.  

Again, be sure that your company is compliant!

 Update on DOL IC Rule

At the American Bar Association’s Labor and Employment Law Section midyear meeting last week, Solicitor of Labor Seema Nanda spoke and said that the DOL is in the process of correcting what it sees as legal errors in an independent contractor rule it adopted under former President Trump. The Trump-era rule focused on the control that a worker has over their work and the worker’s potential for profit or loss and included another criteria that could help inform the analysis if the core factors didn’t produce a clear outcome. She went on to say “one of the things that we are very focused on and very grounded in was the case law.”. “It was our view that the prior administration’s rule was not well grounded in the case law on the economic realities test, which is a multi-factor test that doesn’t have the presumptions that are in the ABC test.” (The ABC test is considered a difficult standard that presumes employee status unless a business can satisfy three criteria.) 

Arbitration is Alive and Well in CA

The Ninth Circuit Court of Appeals has held that an employer can require employees to sign arbitration agreements as a condition of employment, thereby reversing its prior decision and holding that that the state’s attempt to crack down on such agreements with Assembly Bill 51 (AB51) is preempted by the Federal Arbitration Act (FAA).

According to the judge’s issuing opinion, California enacted A.B. 51 to protect employees from “forced arbitration” by criminalizing requirements for employees or job applicants to consent to arbitrate specified claims as a condition of employment. “The [Supreme] Court has made clear that the FAA’s preemptive scope is not limited to state rules affecting the enforceability of arbitration agreements, but also extends to state rules that discriminate against the formation of arbitration agreements,” Judge Ikuta wrote.

 Senate Now Joins Non Compete Saga

In the wake of the FTC proposed rule, the Senate has found bipartisan support for non compete legislation. Led by Senator Chris Murphy (D. CT) and Senator Todd Young (R. IN), the proposed Workforce Mobility Act of 2023  would effectively eliminate noncompete agreements entered into after the bill becomes law. The bill would greenlight the FTC and the DOL to enforce it and allow individual lawsuits to recover damages, as well as costs and attorney’s fees.

The Act would prevent any person or business from entering into, enforcing or attempting to enforce a non compete agreement. There is also a notice requirement for employers to inform workers of the ban on non compete agreements.

The Act contains exceptions for the sale of goodwill or ownership in a business (with the selling owners, as well as in severance agreements for senior execs), as well as in partnership agreements.

 But this is the third attempt to pass such a federal law and there’s a long path ahead before becoming official law.

Can Music Create a Hostile Work Environment?

Two lawsuits have recently been filed that may test the boundaries of what constitutes a hostile work environment under Title VII: Sharp v. S&S Activewear Docket and Israel v. Tesla Docket. 

If music being played in an office is considered obscene or vulgar, can it be deemed as forming the basis of a hostile work environment claim? The EEOC has said that the music at issue could not be the basis for a sex discrimination claim because it offended both men and women. But, what if the lyrics were derogatory towards women, for example, in a rap song?

In an article on the Bloomberg website, partner, Amy Epstein Gluck, was asked about singling out rap music vs. banning all forms of music. Here’s what she said:

“You could be looking at a race discrimination claim” if an employer’s response is just to ban rap, Epstein Gluck said. “You don’t want to get out of the frying pan and into the fire.”

“I would think that music, not a type of music, would be subject to an employer’s policy. No employer really wants to regulate music but I think this fits right into” a nondiscrimination policy, Epstein Gluck added.

Read the article from Bloomberg.

Is a 4-Day Work Week Getting Traction?

A Maryland bill (HB 181 / SB 197) would offer employers with 30+ employees a tax incentive for testing out a four-day week and giving the state’s labor department information on their experience. It also would encourage state and local government agencies to try out the alternate work week. The bill went to committee, but no action was taken.

Republican State Challenging Federal Contractor Wage

Nebraska, Idaho, Indiana, and South Carolina have appealed a January district court ruling that denied their motion to halt the USDOL’s rule to increase federal contractors’ minimum wage to $15 via executive order last April. The appeal will be heard by the US Court of Appeals for the Ninth Circuit. 

The judge in US District Court for the District of Arizona found that the states failed to show that the President exceeded his authority when ordering the pay raise, and that the change wasn’t reviewable under the Administrative Procedure Act, when he dismissed the case Jan. 6th. 

There are also two other legal challenges to the rule pending.

Los Angeles Fair Work Week

Effective April 1, 2023, Los Angeles retailers with 300+ employees will need to comply with a new Fair Work Week Ordinance. This ordinance will require covered employers to provide a written, good-faith estimate of employee work schedules before hiring and within 10 days’ of a request, as well as recordkeeping and work scheduling obligations. If the employer makes shift changes, it would have to pay affected employees premium pay.

 Los Angeles  now joins a growing number of cities passing this type of legislation, including San Francisco and Emeryville, California; New York City; Philadelphia; Chicago; Seattle; Euless, Texas; and Oregon.

If anyone has any questions or concerns please do not hesitate to reach out. Have a wonderful week!

Dave