The Employment Law Lookout’s€¦ · Issue: When should statute of limitations accrue for...

Looking Forward-Looking Back:

The Employment Law Lookout’s

Reviews of 2013 and Things to

Look For in 2014

Introductions

2

Ellen McLaughlin

[email protected]

Dave Baffa

[email protected]

Erin Dougherty Foley

[email protected]

Introductions

Polling

Survey

CLE

©2013 Seyfarth Shaw LLP 3 |

1. SCOTUS Employment Watch

What Happened: • Vance v. Ball State Univ. - Title VII “supervisor” defined as employee

empowered with the ability to "take tangible employment actions

against the victim" such as hiring and firing

Following Vance, employers have successfully applied this narrow

definition of supervisor, making it more difficult for employees to prove

vicarious liability in the context of harassment claims

• Univ. of Texas Southwestern Medical Center v. Nassar - Retaliation

provision of Title VII requires that a plaintiff prove “but for” causation

The majority of cases relying on this decision have found in favor of the

employer, as the employee could not survive the heightened standard

• Fisher v. Univ. of Texas - Equal Protection Clause of the 14th

Amendment permits consideration of race in admissions decisions, but

strict scrutiny applies


1. SCOTUS Employment Watch

What to Watch: Will the pro-employer trend continue?

• Heimeshoff v. Hartford Life & Accident Insurance Co.

Issue: When should statute of limitations accrue for judicial review of a

disability adverse benefit determination under ERISA?

• Sandifer v. US Steel Corporation

Issue: What constitutes “changing clothes” within the meaning of Section

203(o) of the FLSA?

• Lawson v. FMR LLC

Issue: Is an employee of a privately held contractor/subcontractor of a

public company protected from retaliation by SOX?

• Sebelius v. Hobby Lobby Stores, Inc.

Issue: Does the Religious Freedom Restoration Act of 1993 allow a for-

profit corporation to deny Affordable Care Act based on the religious

objections of the corporation’s owners?


2. Class Arbitration Waivers

What’s Happened:

• Supreme Court Upholds Class Arbitration Waivers

American Express Co. v. Italian Colors Restaurant - class

action waiver required merchants to arbitrate their antitrust

claims on an individual, bilateral basis, even though the cost of

pursuing those claims would exceed their potential recovery

• Fifth Circuit Set Aside NLRB’s Decision in D.R. Horton

In D.R. Horton, the NLRB held that Section 7 of the NLRA

invalidates class arbitration waivers

On December 3rd, the Fifth Circuit found NLRB’s decision

conflicted with the FAA

The Eighth, Second, and Ninth Circuits also rejected the NLRB’s

position, finding class arbitration waivers are enforceable in

employment suits ©2013 Seyfarth Shaw LLP 6 |

2. Class Arbitration Waivers

What to Watch: • Anticipate increased use of class arbitration waivers in an

attempt to restrict wage & hour collective actions and

employment class actions

• How will federal courts decide the gateway issue of class

arbitration?

Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp. (2010) and Oxford Health

Plans LLC v. Sutter (2013) left open the issue of whether the arbitrator or

the court should decide whether the agreement permits class arbitration

Elsevier, Inc. v. Crockett (6th Cir. Nov. 5, 2013) - Where the parties have

not agreed who should decide, it is for the court

Lee v. JPMorgan Chase & Co. (C.D. Cal. Nov. 14, 2013) - Relying in

part on Third Circuit law, held that the arbitrator should decide


3. Raising The Bar For Class Actions

What Happened:

• Supreme Court raises the bar for class certification U.S. Supreme Court ruled in Comcast v. Behrend that plaintiffs

must show a method by which class-wide damages can be

commonly calculated lest individual damages questions

overwhelm questions common to the class

• A powerful new weapon in the defense arsenal, some courts are

already using it to deny certification: In re Rail Freight Fuel Surcharge

Antitrust Litigation

• Wal-Mart Stores, Inc. v. Dukes (N.D. Cal.): Plaintiffs’

repackaged class certification theory rejected again

Despite focusing on a “discrete” group of decision makers and a

smaller class, certification was denied because Plaintiffs’ theory

still relies on challenging hundreds of discretionary decisions


3. Raising The Bar For Class Actions

What to Watch:

• Creative Plaintiffs’ counsel continue to search for

the way around Wal-Mart Stores, Inc. v. Dukes In Dukes, the U.S. Supreme Court held that a policy of granting

individual managers discretion over employment decisions failed

to meet the “commonality” requirement under Rule 23(a)

Class actions relying on similar “discretionary” decision making

theories continue to fall

Time will tell if McReynolds v. Merrill Lynch may provide the

distinguishing precedent that Plaintiffs’ counsel are looking for

• Using a “liability-only” approach to evade Comcast

Some courts have narrowed the holding in Comcast, noting that

individual damages can sometimes be determined after a

classwide determination of liability ©2013 Seyfarth Shaw LLP 9 |

4. EEOC End of Fiscal Year

What Happened:

• 134 Lawsuits Filed in FY 2013 48 filed in the last month of the fiscal year

45% of EEOC litigation driven by three districts: Charlotte,

Philadelphia, and Chicago

Retreat from “all in” systemic litigation due to budgetary constraints

Majority of 2013 EEOC cases are single plaintiff

• Strategic Enforcement Plan (1) Barriers in Recruiting and Hiring

(2) Protecting Immigrant, Migrant, and Other Vulnerable Workers

(3) Emerging and Developing Issues

(4) Equal Pay Laws

(5) Preserving Access to the Legal System

(6) Preventing Harassment





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4. EEOC Enforcement Objectives

What to Watch: • “National Law Firm Model”

Expanded systemic investigation capabilities

Augmented technical abilities

Stronger bench of experts

• Continued Focus on Strategic Enforcement Plan (The Big 6)

• Targeting Industry Leaders / Brand Names

• Class Action Waivers

• Potential plans to revise subregulatory guidance documents related

to pregnancy discrimination, reasonable accommodations,

wellness plans, and others

• Plans to revise joint regulations with DOL and DOJ on coordinated

charge and complaint procedures for ADA and Rehab Act claims


5. The Activist NLRB Continues

What Happened: • For the first time in nearly a decade, the NLRB has a

complete five-member board in place

• On November 4, 2013, Richard F. Griffin, Jr. was sworn in as

General Counsel of the National Labor Relations Board

• Sixth Circuit affirms Specialty Healthcare, allowing micro-

units

The composition of the unit is a critical factor in the outcome of a

union election and Specialty Healthcare allows the union far greater

control over this critical factor, thus adding one more challenge to an

employer’s ability to prepare for and respond to union organizing

These smaller units will be easier to organize since unions will be able

to effectively design the voting unit to include only employee groups

with strong support for unionization


5. The Activist NLRB Continues

What to Watch: • Supreme Court granted certiorari in Noel Canning

Federal Courts of Appeal held that Obama’s recess appointments of 4

Board members are unconstitutional

Threatens the validity of several hundred Board cases from January 4,

2012 through July 30, 2012, as well as more than one hundred pending

cases in the circuit courts of appeal

• Anticipate Department of Labor regulations regarding what

constitutes “persuader activity” and impact on employer response

to union organizing

• Anticipate additional pro-employee Board social media decisions

• Key decisions expected regarding ability of employees to utilize

employer e-mail systems for Section 7 activities

• Anticipate NLRB regulations for “quickie” representation elections


6. DOL’s Enforcement Efforts

What Happened:

• Secretary Hilda Solis resigns, replaced by Thomas Perez

• Wage & Hour Division

Dr. David Weil nominated as WHD Administrator

WHD continues to partner with state departments of labor to

coordinate enforcement on misclassification issues

WHD extends minimum wage and overtime rights to most who

provide home care assistance to elderly, ill, or disabled

• OSHA

OSHA continues path of unprecedented citations/fines in 2013

Major changes to HazCom Standard, effective December 1st

Expanded crane and derricks construction standard


6. DOL’s Enforcement Efforts

What to Watch:

• Wage & Hour Division

Anticipate increase in investigations into independent contractor

classifications ($14 million in FY 2014 budget)

Anticipate continued focus on directed investigations in industries

employing vulnerable, low-wage workers

• OSHA

Whistleblower complaints expected after the Affordable

Healthcare Act takes effect

In November, OSHA issued a proposed rule on Electronic Injury

and Illness Records

OSHA announced approval of new warning sign rules

Continued focus on the safety of temporary workers


7. OFCCP: “Game-Changing” Updates to

Veteran and Disability Regulations

What Happened: • DOL revised the VEVRAA and Section 503 of the Rehabilitation Act

to increase obligations of contractors and make it easier for it to

detect deficiencies

• Most notable change: Rules now provide metrics to measure

federal contractors’ progress toward achieving equal opportunity:

VEVRAA requires contractors to establish an annual hiring benchmark

for employment of veterans, either 8% or based on the best available

data and factors unique to their establishments

Section 503 establishes an aspirational 7% utilization goal for the

employment of individuals with disabilities

• Some effective March 24, 2014, with phased-in compliance for

some employers



7. OFCCP’s Major Modifications to

Disability and Veterans Regulations

Themes Section 503 VEVRAA

Hiring Benchmarks & Utilization Goals

Self-identification Early & Often

Additional Outreach Obligations

Reasonable Accommodation

Data Collection, Analysis & Recordkeeping

Transparency and Accountability

Training

Priority Consideration

Jurisdiction, Access and Audits

7. OFCCP: “Game-Changing” Updates to

Veteran and Disability Regulations

What to Watch:

• Internal Look to Ensure Compliance with New Rules

2014 Budget: Start conversations now with key players about the

cost of compliance with the new regulations and next steps

Personnel:

Think about whether you need to hire more staff to ensure compliance

Think about whether you need to conduct training to update team on

new rules

System changes

• OFCCP Watch

Increased number of audits in 2014 and beyond to ensure

compliance with regulations

Also look out for more focus on pay in 2014


8. Immigration Reform Stalls

What Happened:

• The Senate passed Comprehensive Immigration

Reform in June, but it has since stalled in the House

House is now considering piecemeal legislation

• USCIS unveiled a new mandatory Form I-9,

Employment Eligibility Verification

• The annual limit on H-1B visas was reached during the

first week of filing in April 2013

A lottery determined which of the 124,000 petitions were

accepted for processing (for 85,000 visas)


8. Immigration Trends

What to Watch:

• Ever-increasing focus on compliance, investigations &

fraud detection

• Multiple government agencies share overlapping

authority over immigration policy, and have internal

dissension within

• Impact of still-lagging U.S. economy:

Fear of continued loss of U.S. jobs, offshoring

• Strict interpretation of eligibility for immigration benefits:

Lack of transparency

Increasing challenges of H-1B specialty occupation & all factors

of L-1 managers and specialized knowledge worker petitions


9. Redefining Legal Equality:

The Aftermath of Windsor & Perry

What Happened: • United States v. Windsor - Section 3 of DOMA violates the Due

Process Clause as applied to legally married same sex couples

Same sex married couples are now eligible for federal benefits

• Hollingsworth v. Perry - Intervening proponents of Prop. 8 do not

have standing to challenge decision that Prop. 8 violates the equal

protection clause

• Place of Ceremony v. Place of Domicile

But which state’s law applies to determine if legally married?

In August, the IRS issued guidance on the “ceremony” rule

In August, the DOL revised its FMLA fact sheet to clarify the FMLA

follows the “domicile” rule



The Aftermath of Windsor & Perry

What Happened:

• Implications of Windsor on Benefits

Although nothing in ERISA or the DOMA ruling requires self-

funded medical plans to provide health coverage to same-sex

spouses, new laws and regulations could change the landscape

Fully-insured medical plans are subject to state law

If insurer’s policy defines “spouse” in accordance with state law, then

coverage for same-sex spouses may be required under the policy

Qualified retirement plans will need to recognize same-sex

spouses



ENDA and PFA

What to Watch:

• Employment Non-Discrimination Act July 2013: The Senate HELP Committee passed ENDA

November 7, 2013: The Senate passed ENDA in a 64/32 vote It's the

first time the Senate has taken it up since 1996 and the first time it

included transgender protections

Legislative watchers do not predict passage in the House this year

• Paycheck Fairness Act Census Bureau data shows that full-time working women make 77 cents

for every dollar men make per year

Would expand the scope of EPA to revise remedies, enforcement and

exceptions to prohibition of sex discrimination in payment of wages

Legislation was re-introduced in the Senate on January 23, 2013


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