Category — Legal and HR
Yesterday, President Obama signed an executive order and issued a presidential memorandum pressing his equal pay agenda. The executive order establishes that workers cannot be prevented from discussing their pay with other employees or applicants. Its declared target is to support efforts to eradicate gender-based pay disparities. Its aim though is probably more akin to using a hand-held mirror to shoot over your shoulder at the target.
Protecting an employee or applicant because they’ve “inquired about, discussed or disclosed the compensation of the employee or applicant or another employee or applicant” will have only a minimal effect, if any, on pay equity. Its greater effect will be to offer employees a means to claim retaliation if, for instance, no pay raise results or any similar adverse job action occurs after the employee was known to have discussed his pay. This executive order will at least spur employers to redouble their efforts to keep comprehensive HRIS data and use vigorous disposition codes for documenting all types of workplace results for applicants and employees alike.
The presidential memorandum mandates that the Department of Labor create a rule requiring federal contractors and subcontractors to submit summary data on the compensation paid to their employees, including data by sex and race. Obviously, such a rule would normally include classifying the compensation by not only sex and race, but by job title, job grade or some measure differentiating the types of jobs involved. However, this summary data is likely going to be calculated merely by dividing the total compensation for all employees of a particular sex or race by the number of employees of that race or sex. Federal contractors already compile comprehensive information examining their compensation practices annually as part of their affirmative action obligations, but now they will be required to submit a snapshot of that data to the Department of Labor each year. The federal government claims it needs this information because of a “lack of data as a barrier to closing the persistent pay gap for women and minorities.” However, if the Department of Labor’s past practices are any indication, the compensation data will be collected in such a summary fashion that it is virtually worthless as a statistical indicator of pay discrimination. Soon the Department of Labor will be able to claim that overall disparities in compensation between genders or races (which could be driven by one or two highly-paid individuals or which could be the result of perfectly defensible pay decisions) justifies launching a widespread investigation of the employer. How this new data ends up being used against employers in the future will determine whether underpaid workers are benefited or instead whether employers are bludgeoned by submitting unreliable data that will supposedly reveal unlawful pay practices.
So the new federal executive order and presidential memorandum are not nearly as precise as the President intends. At least the approach of requiring a wage disclosure notice (as New York and California have done) where new employees are alerted to the wage rate for each position protects workers from being shortchanged in straight-time and overtime pay. These new orders are not nearly so precise nor useful to the workplace.
April 9, 2014 No Comments
Have you (or others at your company) considered using mandatory arbitration agreements with your employees? The idea is to require an employee who ends up in an employment dispute to handle that dispute before an arbitrator, rather than by filing a lawsuit. But are these agreements valid and enforceable? A recent decision by the Eleventh Circuit Court of Appeals (which handles cases from all federal courts in Georgia, Alabama and Florida) has a lot to say about the overall effectiveness and enforceability of mandatory arbitration agreements.
Last week, the Eleventh Circuit joined four other Circuit courts in holding that an arbitration agreement that waives an employee’s ability to participate in a “collective action” (a little different than but similar to a class action) brought under the Fair Labor Standards Act (FLSA) (the federal wage and hour law) is enforceable under another law known as the Federal Arbitration Act (FAA).
In the case of Walthour et al. v. Chipio Windshield Repair, LLC et al., a group of window repairers originally filed suit against their employer in federal court in Georgia for allegedly failing to pay them overtime wages. The employer tried to take the case out of court because the employees had signed mandatory arbitration agreements. In line with an increasingly popular trend among employers, the arbitration agreement also included a waiver of the employees’ right to take part in a class or collective action (allowing each one to only bring an individual claim). The employees opposed the effort to force them out of court and into individual arbitrations, arguing that their right to file a collective action under the FLSA was a non-waivable, substantive legal right and that the arbitration agreements were invalid because they purported to waive that right.
Following a recent series of pro-arbitration U.S. Supreme Court decisions, the Eleventh Circuit found that the arbitration agreement’s waiver of each employee’s ability to participate in a collective FLSA action was legal and enforceable under the FAA. The court noted that the FAA embodies a broad federal policy favoring arbitration agreements and seeks to relieve congestion in the courts by providing parties with an alternative method for dispute resolution that is speedier and less costly than litigation. In accordance with this federal policy favoring arbitration, the Eleventh Circuit ruled that courts are obligated to enforce arbitration agreements as written absent a “contrary congressional command.” Looking to the FLSA, the FAA, and other appellate court decisions across the country, the Eleventh Circuit held that even though the FLSA allows for collective actions to be brought, that right is not substantive, and it can be waived by employees – and it was in this case.
In an upcoming article in Troutman Sanders LLP’s Employment & The Law newsletter, we will discuss in detail the pros and cons of implementing mandatory arbitration agreements in the workplace. Ultimately, it is a decision each employer should make (in consultation with a trusted employment lawyer). This Eleventh Circuit decision in the Walthour case certainly is something important to consider as part of your company’s decision-making on using or not using mandatory arbitration agreements.
March 27, 2014 No Comments
The media has been full of stories recently about efforts by the city councils in New York City and Philadelphia to pass laws requiring employers to provide employees with paid sick leave. While it appears that the New York City law will come into effect, as it has enough support in the council to overcome the expected veto of Mayor Bloomberg, the Philadelphia city council does not have enough votes to override Mayor Nutter’s veto.
When the New York City law comes into effect, it will join the ranks of San Francisco, Portland, Seattle, Washington, D.C., and the state of Connecticut, each of which have passed laws in recent years requiring employers to provide employees with paid sick leave. At the federal level, the proposed Healthy Families Act, which would require employers to provide paid sick leave, also appears to be gaining traction, particularly in the face of lobbying efforts in many states to pass laws that would specifically preempt efforts by localities to require that employers provide paid sick leave. Where has all this interest in paid sick leave come from?
April 16, 2013 No Comments
Forget Sequestration: Here’s What You Need to Know About the OFCCP’s Expanded Compensation Investigation Procedures
A few days ago, I watched the PBS special, MAKERS: Women Who Make America, about the women’s movement and women’s struggles for equality at home and at work. The documentary highlighted the combined efforts of women across the country in their fight to eradicate gender discrimination, sexual harassment, and unequal pay in the work place. One thing that was particularly shocking was how members of the federal government in the past fought hard to maintain the status quo and keep women out of the workforce.
Oh how times have changed.
Now, there are not only federal laws – such as Title VII and the Equal Pay Act – that prohibit unequal treatment of women in the workplace, but the government is also taking an aggressive approach to ferreting out compensation disparities for female, minority, disabled, and veteran employees of federal contractors and subcontractors.
And we were worried about sequestration. [Read more →]
March 5, 2013 No Comments
The last post, Part 1, set forth the first five items on a wish list from an attorney’s perspective – specific ways in which a Human Resources department can minimize problems down the road. The final five items are just as important. Read on … [Read more →]
February 14, 2013 No Comments
Human Resources professionals have a job that requires a great deal of effort – a good HR Manager will stay on top of developments in employment law; establish sound, consistent procedures for managing typical staff issues, such as leave requests, on-site injuries, and separation from employment; and cultivate good relationships between employees and management. From the other side of the phone line, however, comes a wish list from an attorney’s perspective – what the Human Resources department should consider doing to help minimize difficulty down the road and ensure as successful an HR year as possible. [Read more →]
February 12, 2013 No Comments
Our firm’s latest “Advisory” just went out this afternoon explaining the D.C. Circuit Court of Appeals‘ ruling from last Friday that President Obama’s “recess” appointments to the National Labor Relations Board were unconstitutional, and therefore the Board was without the required quorum to act in a case from last year in which it found a soda-bottling company had committed an unfair labor practice.
This case involves a fascinating legal issue of the interpretation of the U.S. Constitution and the separation of powers between the Legislative and Executive branches (at least for those who find such things fascinating). This decision is also good news for a particular soda-bottling company that challenged the NLRB’s decision. [Read more →]
January 29, 2013 No Comments
The horrific Newtown, Connecticut elementary school massacre has brought the gun control debate front and center. But gun violence is not just in our schools. In August, a former employee shot and killed a co-worker near the Empire State Building before being shot by police himself, and eight bystanders were injured in the shoot-out. A 30-person Minneapolis sign company was decimated in September when an employee who was discharged shot and killed six people, including the company’s founder and a UPS delivery driver, and wounded two others before taking his own life. In November, an Apple Valley Farms employee shot four co-workers at a chicken processing plant in Fresno, California, killing two of them, before turning the gun on himself. Not long after, a ConAgra Foods employee in Indianapolis fatally shot his co-worker outside a break room, then killed himself. Two other workplace violence incidents, in Pine Bluff, Arkansas (an employee fatally shot her co-worker) and Manteno, Illinois (an employee shot and wounded his co-worker), took place in July, 2012. [Read more →]
January 3, 2013 No Comments
Despite expected legislative gridlock and election-year politics, 2012 turned out to be an exciting year for changes in the labor and employment law landscape. The headlines just kept coming. [Read more →]
December 20, 2012 No Comments
As the Department of Labor (DOL) reminds us, October is the month the Office of Disability Employment Policy encourages employers, employees, educators, unions, and other organizations to focus on disability awareness. National Disability Employment Awareness Month is an awareness campaign that, among other things, provides employers with a reminder that the employment of individuals with disabilities requires Human Resources managers to (i) regularly check for legal updates, (ii) conduct policy reviews, (iii) implement thorough training of personnel, and (iv) consult with competent legal counsel to ensure all of the appropriate controls are in place to ensure compliance with a potentially tricky and elastic legal landscape. [Read more →]
October 25, 2012 1 Comment