Labor and Employment Law Cocktail

New I-9 Related Penalties by Timothy M. McConville, Esq.

Timothy M. McConville, Esq. — Tue, 14 Feb 2017 14:30:25 -0500

My colleague, immigration law professor and practitioner Nancy Lawrence, reports that the Federal Register has published the new I-9 related penalties (see pictures below) that went into effect on February 3, 2017. As an example, the first time an employer is charged with employing someone unlawfully, the minimum fine is $548 (maximum is $4,384) per person. The minimum fine for a paperwork violation (for example, completing the I-9 improperly) is $220 per "relevant" person (maximum is $2,191).

Nancy M. Lawrence, Of-Counsel at Odin, Feldman & Pittleman, PC, Reston, VA has practiced family- and employment-based immigration law since 1978, and is an adjunct professor at George Washington University Law School and Washington College of Law (American University). She may be reached at 703-218-2120 or at nancy.lawrence@ofplaw.com.

Timothy M. McConville leads the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. Mr. McConville may be reached at 703-218-2119 or timothy.mcconville@ofplaw.com. Follow him at laborandemploymentlawcocktail.com and on Twitter @worklawguy.

Court Enjoins DOL Overtime Rule on Nationwide Basis by Timothy M. McConville, Esq.

Timothy M. McConville, Esq. — Wed, 23 Nov 2016 12:42:59 -0500

A federal court in Texas yesterday enjoined the United States Department of Labor from implementing and enforcing the DOL's controversial new regulation revising white collar exemptions under the Fair Labor Standards Act. The court applied its injunction nationwide, preventing the DOL's rule from becoming effective as of December 1, 2016, as the DOL had previously prescribed.

By imposing the requirement that white collar employees earn at least $913 per week, the DOL's rule would have categorically excluded from the white collar exemptions employees who earn less than $913 per week, irrespective of their job duties and responsibilities. The court held the DOL's categorical exclusion to be unlawful.

"With the Final Rule, the Department exceeds its delegated authority and ignores Congress's intent by raising the minimum salary level such that it supplants the duties test. Consequently, the Final Rule . . . is unlawful. The Department’s role is to carry out Congress’s intent. If Congress intended the salary requirement to supplant the duties test, then Congress, and not the Department, should make that change," District Judge Amos L. Mazzant wrote in his injunction order. Judge Mazzant is on the United States District Court for the Eastern District of Texas.

The DOL rule, published in the Federal Register on May 23, 2016, would increase the salary level at which executive, professional, and administrative employees must be paid to qualify as exempt from the FLSA's minimum wage and overtime provisions under statutory exemptions for executive, administrative, and professional employees. The exemptions are also known as the "white collar exemptions.” Each white collar exemption requires that the employees have as their primary duties particular executive, administrative, or professional duties. Under the DOL rule, to be exempt under the white collar exemptions, employees would have to be paid a salary equal to the 40th percentile of weekly earnings of full-time non-hourly workers, based on Bureau of Labor statistics. Based on 2015 BLS data, the DOL’s rule would revise the salary level test to $913 per week, or $47,476 for a full-year worker, from the current level of $455.

The DOL rule enjoined by the court yesterday also included a mechanism automatically to update the salary thresholds every three years using published BLS data for the 40th percentile of weekly earnings of full-time non-hourly workers.

Employer organizations and various States challenged the DOL's rule in multiple lawsuits, which were consolidated before Judge Mazzant. The State plaintiffs asked the court to enjoin implementation of the rule while the case was pending, arguing that implementation as scheduled by the DOL would cause irreparable harm to the States and employers generally. The DOL itself projected that, in the first year under the rule, 4.2 million workers who are currently exempt would become non-exempt and eligible for overtime compensation under the FLSA. The DOL estimated that the rule would cause a $1.28 billion transfer of income from employers to employees in the first year following implementation.

While the court's opinion was categorical in stating that "the Final Rule . . . is unlawful," the issue decided by the court was only whether a preliminary injunction should be issued, and the court's ruling was not a final disposition of the case. As a practical matter, however, the decision may signal an impending demise of the rule because, having decided that the rule is unlawful for purposes of a preliminary injunction, the court may be unlikely to change its opinion on the point when it ultimately reaches the merits of the case. In addition, a new Secretary of Labor under a President Donald Trump may dramatically change the DOL's course on the rule.

Timothy M. McConville is the practice group leader of the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. Mr. McConville may be reached at 703-218-2119 or timothy.mcconville@ofplaw.com. Follow him at laborandemploymentlawcocktail.com and on Twitter @worklawguy.

Vote Yes for Virginia Right to Work Amendment on Nov. 8

Timothy M. McConville, Esq. — Wed, 26 Oct 2016 15:54:07 -0400

Constitutional Provision Will Protect Freedom and Jobs

By Timothy M. McConville, Esq.

Workplace choice, employee freedom, and better economic performance are part and parcel of the Right to Work package, which is why this November 8, Virginians should vote Yes to enshrine these Right to Work advantages in the Virginia Constitution.

Since 1947, Virginia’s Right to Work statute has ensured that no employee can be forced to join or pay dues to a union, leaving the decision of union membership and financial support where it belongs, with each individual working person. On the basis of protecting each worker’s freedom of association alone, the Right to Work principle should be protected by the adoption of a state constitutional amendment.

But the benefits do not stop there. Right to Work also brings significant economic benefits to the Commonwealth and its citizens. According to data compiled by the National Institute for Labor Relations Research, Right to Work states have enjoyed higher private-sector job growth and larger wage increases over the past decade compared to their forced-unionism counterparts which include Maryland. After adjusting for states’ differing costs of living, residents in Right to Work states enjoy more disposable income than their non-Right to Work neighbors.

Virginia’s Right to Work principles help keep the state in the top ranks of surveys gauging business-friendly environments. CNBC recently released its list ranking the best states for business in 2016, and 15 of the top 20 states are Right to Work states. Virginia ranked 13th, a slight drop from 12th in 2015, and a signal that we need to protect Right to Work by adopting the constitutional amendment on election day. Of course, the connection between Right to Work and better economic performance should not come as a surprise. Business experts consistently rank the presence of Right to Work laws as one of the most important factors companies consider when deciding where to expand or relocate their facilities where they will create new jobs.

Right to Work laws also encourage unions to be more flexible and responsive in the workplace. Where workers cannot be forced to join or pay dues, union officials have to work harder to retain employee support. This encourages union officials to put workers’ interests first, rather than promoting their own power or pushing an agenda that is out of step with the rank-and-file.

Right to Work laws make economic sense, but protecting employee freedom has always been their most important feature. No worker should be forced to join or pay money to an organization he or she has no interest in supporting. The laws do nothing to impede employees from voluntarily joining or paying dues to a union; they simply ensure that no worker can be forced to hand over a portion of a hard-earned paycheck to union officials just to keep a job.

Poll after poll shows the American people overwhelmingly oppose forced union dues and membership, a view shared by rank-and-file union members. In the November 8 election, the only poll that really counts this year, Virginia business people and workers alike will have the opportunity to vote to approve the Right to Work amendment to the Virginia Constitution. I believe they should vote Yes.

Timothy M. McConville leads the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. He is a member of the Board of Directors of the Loudoun County Chamber of Commerce and Chairman of the Board of the National Institute for Labor Relations Research, Inc. Reach him at timothy.mcconville@ofplaw.com and follow him on Twitter @worklawguy.

DOL's Proposed Overtime Rule Will Change White Collar Exemptions by Timothy M. McConville, Esquire

Timothy M. McConville, Esq. — Wed, 03 Feb 2016 09:49:08 -0500

Proposed changes to federal regulations governing overtime pay may dramatically expand the number of employees entitled to overtime pay under the Fair Labor Standards Act (“FLSA”) and employers should plan now for the impact.

Required Salary Level Expected to Exceed $50,000

The Department of Labor is proposing to increase the salary level at which executive, professional, and administrative employees must be paid to qualify as exempt from FLSA’s minimum wage and overtime provisions under the so-called “white collar exemptions.” The proposed change would also affect the salary level applicable to computer employees. Under the proposal, to be exempt under the white collar exemptions, employees would have to be paid a salary equal to the 40th percentile of weekly earnings of full-time salaried workers, as determined annually by the DOL’s Bureau of Labor Statistics. Based on 2013 BLS data, the DOL’s proposed rule would revise the salary level test to $921 per week, or $47,892 for a full-year worker, from the current level of $455.

The DOL is also proposing to change the compensation level for employees to qualify as exempt under the exemption for highly compensated employees. Specifically, if finalized, the proposed rule would set the annual compensation level at an amount equal to the 90th percentile of earnings for full-time salaried workers ($122,148 annually). The current level requires annual compensation of $100,000.

Annual Updates Would Boost Salary Levels Annually

To eliminate the need for future rulemaking regarding salary and compensation levels for the white collar exemptions, the DOL is proposing to include a mechanism automatically to update the salary and compensation thresholds on an annual basis using either a fixed percentile of wages or the Consumer Price Index – Urban. The proposal noted that the DOL would update the data supporting the final rule, which is expected later this year.

The Department has stated that, if the final rule adopts a rule based on the 40th percentile of weekly earnings of salaried employees, it would likely rely on data from the first quarter of 2016. It also indicated that, as of July 6, 2015, the date of the publication of the proposed rule, the latest data currently available were for the first quarter of 2015, in which the 40th percentile of weekly earnings was $951. Assuming two percent growth between the first quarter of 2015 and the first quarter of 2016, the DOL is projecting that the 40th percentile weekly wage in the final rule would be $970, or $50,440 for a full-year worker. The annual updates would require vigilance by employers to ensure that exempt employees, particularly any at or just above the salary level, do not fall below any updated salary level and thereby lose their exemption and become entitled to overtime pay. For some, the annual update could operate to cause annual increases in salary rates.

Impact Expected to be Significant

The proposed changes in the salary and compensation levels represent significant changes relative to historical levels, including under both the “short” and “long” tests for the white collar exemptions under previous regulations.The DOL projects that the regulatory revisions would affect 4.6 million workers who are currently exempt but who would not satisfy the proposed salary level. The Department also projects employers to incur $592.7 million in direct costs for compliance activities in the year following implementation of the rule. If finalized, in the first year of implementation, the proposed rule will redistribute $1.482 billion from employers to employees, according to the DOL.

Watch List for Other Possible Changes

Since 1940, the DOL regulations implementing the white collar exemptions have generally required each of three tests, i.e., the salary level test, the salary basis test, and the primary duty test, to be met for the exemptions to apply. To be paid on a salary basis, an individual must be paid a predetermined and fixed amount that is not subject to reduction because of variations in the quality or quantity of work performed. To satisfy the primary duty test, the employee’s job duties must primarily involve executive, administrative, or professional duties. The primary duty tests have specific elements that must be met. Exemptions for computer professionals require specific primary duties but permit the satisfaction of compensation requirements either by payment of an hourly rate of $27.63 or on a salary basis at the level required by the regulations, which is currently $455 per week.

The DOL’s proposed rule contains no change to either the salary basis or the primary duty tests. Indicating that it was “concerned” that current primary duty tests allow the exemption of employees performing such a “disproportionate amount of nonexempt work that they are not exempt in any meaningful sense,” however, the DOL asked for and received comments from interested parties regarding whether the duty tests should be revised. The Department indicated that it was considering the need for a possible revision to the primary duty element that would require exempt employees to spend a specified amount of time, e.g., at least 50 percent, performing the primary duty. The current rule does not require any specific amount of time to be spent on the primary duty and requires only that the employee’s primary duty be non-exempt work.

The Department also indicated that it would also consider whether a final rule would permit nondiscretionary bonuses to satisfy up to 10 percent of the salary requirement applicable to the white collar exemptions. The DOL also received input from interested parties regarding whether commissions should be counted to satisfy the salary level requirement.

Employers Should Prepare Now

The DOL has signaled that it may issue a final rule in July 2016, which permits employers some time to prepare for the possible changes. While the proposed rule would apply to all employers covered by the FLSA, some industries, including hospitality, restaurants, and retailers, will be harder hit than others. State and local law also may have different exemption requirements. Employers should consider the following actions to prepare:

Identify any employees who earn less than $47,892 and $50,440 per year.
Identify any employees who earn $122,148 or more per year.
Analyze jobs and job descriptions, including borderline exemption classifications for executive, administrative, professional, and outside sales employees and highly compensated individuals.
Reevaluate exemption classifications to determine that positions are properly classified and meet the tests for salary or compensation, the salary basis, if applicable, and primary duty.
Ensure the payroll system reflects exempt/nonexempt status accurately.
Consider increases in compensation, reclassification of positions as non-exempt or exempt, and changes in duties in order to comply with exemption requirements.
Consider exemption requirements under applicable state and local law.
Check any collective bargaining agreement that may apply to individuals in relevant positions and prepare to perform bargaining obligations, if any.
Project possible costs to the organization, including the number of hours worked by impacted employees and the cost of any salary increases indicated.

Misclassification of employees is a common source of employer liability under the FLSA, and employers should rely on labor and employment law counsel to support their compliance activities.

Timothy M. McConville leads the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. Mr. McConville may be reached at 703-218-2119 or timothy.mcconville@ofplaw.com. Follow him at laborandemploymentlawcocktail.com and on Twitter @worklawguy.

Exercise Care When Terminating an Employee Who Holds H-1B Status by Nancy M. Lawrence, Esq.

Nancy Lawrence — Thu, 07 Jan 2016 13:57:11 -0500

If an employer doesn’t follow certain requirements when it terminates an employee holding an H-1B visa, then the employer could be surprised to learn that employee wasn’t properly terminated, and the obligation to pay that employee wages and benefits continues despite the attempted termination. As background, Department of Labor (DOL) regulations at 20 CFR §655.731 provide guidance regarding wage obligations relating to H-1B ("specialty occupation") employees. Employers are required to pay to H-1B visa holders the higher of the prevailing wage for the occupation, or the actual wage for the position, as confirmed in the Labor Condition Application (LCA) that the employer must file during the H-1B petition process.

This wage obligation even applies to H-1B nonimmigrants who have been "benched" or are no longer actively working for the employer. When an employer terminates an H-1B employee prior to the expiration date of the employee's H-1B status, DOL considers this action to be a form of benching the employee UNLESS/UNTIL the employer has taken the following steps to effectuate a "bona fide" termination:

STEP 1 - The employer must notify the USCIS that the relationship has been terminated (USCIS will then cancel the petition); and

STEP 2 - The employer must provide the employee with offer of payment for return transportation abroad [for these purposes, the term "abroad" is defined in 8 CFR 214.2(h)(4)(iii)(E) as the foreign national's last place of foreign residence].

Although not required by regulation, it is also advisable for the employer to withdraw the underlying Labor Condition Application (LCA), as long as the terminated employee is the only employee who has been covered by that particular LCA.

Failure to take Steps 1 and 2 above may result in DOL's requiring the employer to pay back wages commencing on the date of attempted dismissal and continuing until the date upon which DOL determines that the termination has been perfected.

Note that these regulations do not apply to an H-1B employee who has voluntarily terminated his/her employment prior to the H-1B expiration date. Termination by the employer launches these stringent requirements. In reality, many terminated H-1B employees are able fairly quickly to secure new employment and to transfer their H-1B sponsorship to the new employer; however, these two simple steps should shield the original H-1B sponsor from potential back-pay obligations.

Unions and NLRB’s Election Procedures Implicate APA, Threaten Rehabilitation Programs

Timothy M. McConville, Esq. — Thu, 15 Oct 2015 10:16:24 -0400

By Timothy M. McConville, Esq.

Recent developments at the National Labor Relations Board should cause leaders of non-profit Community Rehabilitation Programs (“CRPs”) to reevaluate the substantial risks that the law and organized labor pose to the relationships between CRPs and the special individuals that they help. The developments also reveal how the NLRB’s election procedures, known among employers as “ambush election rules” for their fealty to conducting elections as soon as possible, expose the Board to a violation of the Administrative Procedure Act.

CRPs liberate individuals with severe disabilities by providing them with intensive rehabilitation and training that permit them to pursue a path toward independence. For individuals whose severe limitations make them generally unemployable in the competitive job market, a CRP can provide life-changing, valuable options. Of course, a valuable work environment also tends to attract union organizers looking for union dues, and CRPs are not immune to this phenomenon. Unions have a history of targeting CRPs for organizing, and recent legal developments make clear that CRPs should be prepared to protect rehabilitative relationships from union activity.

Unions Target AbilityOne Rehabilitation Participants

The NLRB has issued a line of cases that address the circumstances under which unions may (or may not) interject themselves into CRPs’ relationships with individuals with significant disabilities. For years, the NLRB has declined to assert jurisdiction over sheltered workshops, rehabilitative vocational programs and similar programs that are primarily rehabilitative in nature. As a majority of the NLRB explained in Brevard Achievement Ctr., Inc., a 2004 case, the Board declines to assert jurisdiction over relationships that are primarily rehabilitative because the “imposition of collective bargaining on relationships that are not primarily economic does not further the policies of the Act.” The Board has held that the Act is premised on the view that, in arms-length economic relationships, areas of conflict may exist between employers and employees that may be resolved through a contest of economic strength. This premise, which includes granting union officials a monopoly over representation of employees, is not well-suited to a setting that is primarily rehabilitative.

The issue arises particularly in the context of the AbilityOne federal contracting program which provides employment training opportunities to CRPs. In determining whether individuals with severe disabilities are statutory employees and thus subject to union organizing under the NLRA, the Board examines the nature of the relationship between the individuals and the CRP. If that relationship is guided primarily by business considerations, such that it can be characterized as “typically industrial,” the individuals will be found to be statutory employees.

If, on the other hand, the relationship is primarily rehabilitative in nature, the individuals will not be found to be statutory employees, which means they are outside the scope of the NLRA. The Board examines numerous factors, including the existence of counseling, training, or rehabilitation services; the existence of any production standards; the existence and nature of disciplinary procedures; the applicable terms and conditions of employment (particularly in comparison to those of nondisabled individuals employed at the same facility); and the average tenure in the program, including the existence/absence of a job-placement program.

As Applied to CRPs, Ambush Election Procedures Implicate APA

In the Brevard Achievement Ctr. case, a majority of the NLRB followed established case law and found that the individuals at issue in the case were not statutory employees under the NLRA because their relationship with the CRP was primarily rehabilitative. The ruling protected the special rehabilitative relationships from intrusion by union officials, with a Board majority holding that “[t]he imposition of collective bargaining at the rehabilitative stage could interfere with the rehabilitative process itself, and thereby delay the day when the clients can enter in the mainstream of economic society.

The Brevard Achievement Ctr. case did not cause any significant change in established precedent governing the unionization of individuals with severe disabilities who participate in CRPs. What stands out, however, is a dissenting opinion by Members Wilma B. Liebman and Dennis P. Walsh, who called for wholesale application of the NLRA to individuals with significant disabilities participating in CRPs. The dissent is remarkable for its express willingness to insert union officials with no rehabilitative qualifications between CRP professional counselors and the severely disabled, whom the dissenters acknowledged are not capable of independently obtaining a job in a competitive work environment.

In at least two NLRB cases this year, a union has relied on the dissenters’ theory and petitioned the NLRB to become the exclusive representative of individuals with severe disabilities who were obtaining rehabilitative services from a CRP. In one case, the union initially sought to include both non-disabled workers and individuals with significant disabilities in the bargaining unit. In another case, the union demanded exclusive bargaining power over a unit that consisted entirely of individuals with significant disabilities. In both cases, the CRP succeeded in resisting the union organizing campaigns, but not without having to put up a substantial defense.

NLRB Election Rules Ignore HIPAA Protections

The conflict between HIPAA and the Board’s procedures expose the Board to a violation of the Administrative Procedure Act because the Board’s rules effectively would require a CRP to disclose protected health information in violation of HIPAA. Despite its acknowledgment in the preamble to the final rule that protected health information was far more sensitive than the limited information it thought its rule would require, the Board entirely failed to consider this important aspect. Instead, the NLRB opted for a general rule requiring production of the required information without any regard to whether the information was protected under federal law governing private medical information. Nor did the Board provide any exception for security or advanced protocol in cases in which the disclosure of the full names and contact information of individuals would equate to a prohibited disclosure of protected health information under HIPAA.

If unions continue to target organizing activity at CRP participants, the Board’s election procedures could be the subject of a serious challenge under the APA. Failure to disclose the required information imposes significant consequences under the Board’s rules, including the waiver of important legal arguments. The Board’s procedures have other requirements that dramatically compromise a CRP’s ability to defend its program and rehabilitative relationships with program participants.

In the past, rehabilitation professionals generally have been able to focus on the best interests of CRP participants without interference from union officials. Now, recent developments threaten CRPs and the tremendous benefits they deliver. CRP leaders should be prepared to respond to the heightened risks, including by careful evaluation of the legal factors that affect whether, in the eyes of the NLRB, the CRP’s relationship with individuals with significant disabilities is primarily rehabilitative.

Timothy M. McConville leads the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. Mr. McConville may be reached at 703-218-2119 or timothy.mcconville@ofplaw.com. Follow him at laborandemploymentlawcocktail.com and on Twitter @worklawguy.

Unions and NLRB Procedures Threaten Community Rehabilitation Programs

Timothy M. McConville, Esq. — Wed, 14 Oct 2015 11:48:16 -0400

By Timothy M. McConville, Esq.

Recent developments at the National Labor Relations Board should cause leaders of non-profit Community Rehabilitation Programs (“CRPs”) to reevaluate the substantial risks that the law and organized labor pose to the relationships between CRPs and the special individuals that they help. CRPs liberate individuals with severe disabilities by providing them with intensive rehabilitation and training that permit them to pursue a path toward independence. For individuals whose severe limitations make them generally unemployable in the competitive job market, a CRP can provide life-changing, valuable options.

Of course, a valuable work environment also tends to attract union organizers looking for union dues, and CRPs are not immune to this phenomenon. Unions have a history of targeting CRPs for organizing, and recent legal developments make clear that CRPs should be prepared to protect rehabilitative relationships from union activity. The National Labor Relations Board, which administers the National Labor Relations Act, has issued a line of cases that address the circumstances under which unions may (or may not) interject themselves into CRPs’ relationships with individuals with significant disabilities.

For years, the NLRB has declined to assert jurisdiction over sheltered workshops, rehabilitative vocational programs and similar programs that are primarily rehabilitative in nature. As a majority of the NLRB explained in Brevard Achievement Ctr., Inc., a 2004 case, the Board declines to assert jurisdiction over relationships that are primarily rehabilitative because the “imposition of collective bargaining on relationships that are not primarily economic does not further the policies of the Act.” The Board has held that the Act is premised on the view that, in arms-length economic relationships, areas of conflict may exist between employers and employees that may be resolved through a contest of economic strength. This premise, which includes granting union officials a monopoly over representation of employees, is not well-suited to a setting that is primarily rehabilitative.

In at least two NLRB cases this year, a union has relied on the dissenters’ theory and petitioned the NLRB for the power to be the exclusive representative of individuals with severe disabilities who were obtaining rehabilitative services from a CRP. In one case, the union initially sought to include both non-disabled workers and individuals with significant disabilities in the bargaining unit. In another case, the union demanded exclusive bargaining power over a unit that consisted entirely of individuals with significant disabilities. In both cases, the CRP succeeded in resisting the union organizing campaigns, but not without having to put up a substantial defense.

Along the way, the NLRB’s procedures exposed the rehabilitative program to significant risk. Specifically, Board procedures require that respondents in representation cases disclose private information relating to the individuals in targeted bargaining units, including names, addresses, email addresses, phone numbers, and shift designations. In a case in which the entire bargaining unit consists exclusively of individuals with severe disabilities, compliance with the Board’s disclosure requirements will expose a CRP to a violation of privacy rules under the Health Insurance Portability and Accountability Act. Failure to disclose the required information also would impose consequences under the Board’s rules, including the waiver of important legal arguments. The Board’s procedures, known among employers as “ambush election rules” for their fealty to conducting elections as soon as possible, have other requirements that dramatically compromise a CRP’s ability to defend its program and rehabilitative relationships with program participants.

In the past, rehabilitation professionals generally have been able to focus on the best interests of CRP participants without interference from union officials. Now, recent labor relations developments threaten CRPs and the tremendous benefits they deliver. CRP leaders should be prepared to respond to the heightened risks, including by careful evaluation of the legal factors that affect whether, in the eyes of the NLRB, the CRP’s relationship with individuals with significant disabilities is primarily rehabilitative.

Is Your Federal Contracting Business Covered by OFCCP Affirmative Action Rules? by Timothy M. McConville, Esq.

Timothy M. McConville, Esq. — Mon, 21 Sep 2015 08:34:23 -0400

The myriad employment laws on the books at the federal, state, and local level can make what should be the simple act of doing business seem like negotiating a minefield. Add a federal contract to the mix, and compliance gets a whole extra layer of complexity. The Rehabilitation Act of 1973, the Vietnam Era Veterans' Readjustment Assistance Act, Executive Order 11246, the Service Contract Act, and the Davis-Bacon Act are just a few authorities that may apply.

With respect to affirmative action rules, the Department of Labor Office of Federal Contract Compliance Programs ("OFCCP") has developed a new “Jurisdictional Thresholds” infographic that may help some federal contractors understand their obligations. The infographic summarizes when OFCCP’s Executive Order 11246, Section 503 of the Rehabilitation Act ("Section 503"), and the Vietnam Era Veterans' Readjustment Assistance Act regulations apply to companies doing business with the federal government.

The OFCCP's infographic includes a recent increase to Section 503’s coverage threshold from $10,000 to $15,000. The increase resulted from an inflationary adjustment statute that authorizes the Federal Acquisition Regulatory Council to review and adjust “acquisition-related” threshold amounts in statutes that apply to federal procurement.

The infographic is available for download on OFCCP’s Web site here. Of course, the OFCCP's summary information is not legal advice. Federal contractors should consult an attorney to determine precisely whether they are covered by particular rules, and if so, what the rules require specifically.

The New "Don't Ask, Don't Tell:" Virginia Statute Protects Employees' Social Media Passwords by Timothy M. McConville, Esq.

Timothy M. McConville, Esq. — Tue, 08 Sep 2015 08:37:01 -0400

Work interests and personal interests often intertwine, particularly when employees use social media to broadcast about work, and sometimes, what happens on an employee's Facebook page directly affects his or her employer's business interests. Now, if that happens in Virginia, and if an affected employer wants to act to protect itself, it will have to remember that the Commonwealth has enacted a statute that protects employees' usernames and passwords from employer disclosure requirements.

A new statute enacted by the Virginia General Assembly and effective July 1, 2015, prohibits employers in Virginia from requiring current or prospective employees from disclosing the usernames and passwords associated with their social media accounts. The new statute also attempts to head off employers from requiring employees and applicants to permit managers and supervisors to "follow" them in their social media travels by prohibiting employers from requiring employees and applicants to add an employee, supervisor, or administrator to lists of contacts associated with social media accounts.

The statute attempts to strike a balance between protection of employees' private social media account information and an employer's inadvertent reception of such information. If an employer inadvertently receives an employee's username and password to, or other login information associated with, the employee's social media account through the use of an electronic device provided to the employee by the employer or a program that monitors an employer's network, the employer will not be liable for having the information. The employer, however, is required to refrain from using the information to gain access to an employee's social media account.

The new law also carves out employer activities associated with compliance with federal, state, or local law and employer investigations of allegations of violations of the law or written employer policies. Employers' existing rights or obligations to request username and password information, which rights and obligations the General Assembly did not specify in the statute, are not affected in cases where such information "is reasonably believed to be relevant to a formal investigation or related proceeding by the employer of allegations of an employee's violation of federal, state, or local laws or regulations or of the employer's written policies." If an employer exercises its rights under the investigatory exception, the employer is prohibited from using the employee's username and password for any purpose other than the purpose of the formal investigation or a related proceeding.

Employers are prohibited from taking action against or threatening to discharge, discipline, or otherwise penalize a current employee for exercising his rights under the statute. Employers also may not fail or refuse to hire a prospective employee for exercising his rights under the law.

The intersection of social media activities and labor and employment law has been the subject of increased scrutiny by policymakers on both the state and federal level. The National Labor Relations Board has been particularly active in regulating employers' application of their social media policies and practices in the context of the National Labor Relations Act. See Charity Price, NLRB Settles Claims Based on Employer's Social Media Policy, Labor and Employment Law Cocktail (Feb. 6, 2014).

Timothy M. McConville leads the labor and employment group at the law firm of Odin, Feldman & Pittleman, P.C. in Reston, Virginia. Mr. McConville may be reached at 703-218-2119 or timothy.mcconville@ofplaw.com. Follow him at laborandemploymentlawcocktail.com and on Twitter @worklawguy.

NLRB Refines Joint Employment Standard

Timothy M. McConville, Esq. — Thu, 27 Aug 2015 15:53:47 -0400

In a 3-2 decision issued today involving Browning-Ferris Industries of California, the National Labor Relations Board refined its standard for determining joint-employer status.

In the decision, the Board held that two or more entities are joint employers of a single workforce if (1) they are both employers within the meaning of the common law; and (2) they share or codetermine those matters governing the essential terms and conditions of employment. The Board also ruled that, in evaluating whether an employer possesses sufficient control over employees to qualify as a joint employer, the Board will – among other factors -- consider whether an employer has exercised control over terms and conditions of employment indirectly through an intermediary, or whether it has reserved the authority to do so.

In its decision, the Board found that BFI was a joint employer with Leadpoint, the company that supplied employees to BFI to perform various work functions for BFI, including cleaning and sorting of recycled products. In finding that BFI was a joint employer with Leadpoint, the Board relied on indirect and direct control that BFI possessed over essential terms and conditions of employment of the employees supplied by Leadpoint as well as BFI’s reserved authority to control such terms and conditions.