Virtually every settlement agreement in an employment case includes a strict confidentiality clause warning the plaintiff of the requirement to keep the settlement amount secret. In a recent case which made national news, a daughter cost her father an $80,000 settlement by posting “mama and Papa Snay won the case against Gulliver … Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT!” An article with more details on the story can be found here.
This case is a good reminder of the importance of drafting airtight confidentiality clauses in the era of social media and instant publication to the world. It is also important to note that the employer lost the first round of litigation on whether the daughter’s conduct violated the father’s settlement agreement, and this recent story relates to the appellate court’s decision to overturn the lower decision and void the settlement. Obviously, the employer spent a lot of money in legal fees to prove a point.
One of the hot issues under the Fair Labor Standards Act (FLSA) is whether employers should be required to pay employees for time spent waiting in security lines to access their job site. Employees argue that such time is required as part of their jobs, and thus should be paid. Employers argue that such time is not “work” and is not compensable. A case involving contract employees at one of Amazon.com’s warehouses in Nevada was accepted by the Supreme Court this week, setting up a significant decision which could impact wage and hour practices around the country.
In the Amazon case, workers alleged they had to spend nearly 30 unpaid minutes each day waiting in line to clear security checks before and after their shifts. The Ninth Circuit Court of Appeals ruled that the case could move forward, which set up a conflict with other court decisions. An article about the case can be found here. This case will have a significant impact on Texas, where many contractors at plants and refineries have faced similar lawsuits. A decision from the Supreme Court should be expected in the summer of this year.
I recently gave an interview to Intuit Quickbase (another blog on Human Resources issues) on the subject of avoiding wage and hour lawsuits from interns. The interview can be found here, and provides some practical tips on this increasingly problematic area of the law.
Today, the IRS issued final regulations concerning the employer mandate portion of Obamacare. The imposition of the employer mandate had previously been postponed from 2014 to 2015, and now has been pushed back one more year for employers with less than 100 employees. For large employers, the penalties have also been eased with a transition period where employers will be able to avoid penalties as long as most full-time workers are covered (70 percent in 2015 and 95 percent in 2016).
The regulations can be found here, and a news report summarizing the announcement is linked here.
On February 19th, the Southwest Meat Association will be presenting its annual Mid-Year Conference. An agenda for the conference can be found here.
Our firm will be providing two presentations related to employment law. I will be presenting on the Affordable Care Act and Nelsy Gomez will provide an update on recent developments in immigration and employment. If you are in the meatpacking or food processing industries, we hope to see you there.
This week, Target announced that it will no longer offer health insurance to part time workers. Target joins a long list of companies who have made the same decision, including Trader Joe’s and Home Depot. Details about the announcement can be found here.
There is a clear trend developing and the days of part-time employees being eligible for company-sponsored health insurance look to be numbered. Many companies already have low participation rates from part-time workers, and the economics of the new exchanges, and the subsidies available for low income workers, have even further eroded the need for such plans. Of course, the big question is whether this step is just the first in a long term trend towards moving employees from full-time to part-time positions to avoid paying for the cost of healthcare.
On January 10, a federal judge in Florida certified a nationwide collective action against Lowe’s Home Centers. If the story stopped there, it would be unremarkable since virtually every large company has been hit with wage and hour suits in recent years.
What is interesting about this case is that it was filed by HR Managers claiming they were improperly classified as exempt from overtime. The plaintiff was an HR Manager at an individual store and claimed that she did not supervise anyone and did not exercise the necessary level of independent discretion and judgment to meet the administrative exemption. The plaintiff claimed that all meaningful employment decisions, like terminations, were made by higher ups within the HR department, and that she primarily performed clerical duties. A copy of the judge’s decision can be found here.
The takeaway from this decision is that not even HR departments are immune from overtime lawsuits. Many exempt HR personnel do not qualify for the executive exemption because they do not directly supervise two or more full-time employees. The administrative exemption, which likely would apply to HR staff, can pose challenges in ligation because it revolves around the level of discretion enjoyed by the employee (which can be subjective). Prudent employers should make sure to keep records of exempt HR employees being involved in hiring, firing or discipline of employees. Keep in mind that the law does not require the exempt employee to have final authority to make decisions, only that he or she be allowed to make recommendations which are given substantial weight. Keeping such records will make it very difficult for the exempt employee to sue for mis-classification and overtime.
On January 6, 2014, the National Labor Relations Board (NLRB) gave up on its fight to require all employers to post a notice informing employees of their right to form a union. The NLRB’s mandatory poster rule was invalidated by two separate U.S. Courts of Appeals, and the prospects of the NLRB winning at the Supreme Court were slim. This brings a conclusion to a fight that began in 2011 when the NLRB ordered all employers to post the notice, which many argued was biased in favor of unions.
The NLRB’s statement on the poster can be found here.
Each year, my firm’s labor department issues a client report analyzing all of the important legal developments which impact employers, as well as taking a look ahead to upcoming issues. The 2013 version of that report is now available and can be found by clicking here. Inside the report are great articles about privacy law, social media in the workplace, healthcare reform and more. When things are slow during the holidays, I encourage you to take some time to read these articles.
Among all of the myriad problems with the Affordable Care Act (a/k/a Obamacare) is a little publicized issue which could devastate volunteer fire departments across the country. Since the Supreme Court ruled that Obamacare is a “tax” and the IRS considers volunteer fire fighters to be employees, a fight is brewing over whether such volunteers must be offered health insurance.
Fire departments and unions representing fire fighters have been publicizing the enormity of the potential impact (link here). A bipartisan group of Senators wrote the Department of Labor and IRS on Monday, December 16th, lobbying for non-coverage under the law, and a legal opinion is expected sometime in early 2014 before the employer mandate becomes effective. If volunteers are deemed to be employees, the fire departments will be required to offer health insurance or else face steep penalties. This would effectively bankrupt volunteer fire departments, which have tight budgets, and would be wasteful since most personnel likely have other jobs which offer benefits.
Since we all rely on fire protection, this is an important issue which should be followed closely.