Anti-Trust Laws Can Impact HR Departments

You cdep-of-justan add anti-trust laws to the long list of legal risks that must now be managed by corporate HR departments. According to a recent guidance document prepared by the Federal Trade Commission and the Department of Justice, the following acts could result in not only civil liability, but criminal prosecution:

  • Agreements between companies to not recruit or hire the other’s employees (a/k/a no-poaching agreements)
  • Talking to other industry members about establishing uniform pay scales or caps on pay
  • Agreements between competitors to limit or reduce fringe benefits

These laws can be especially tricky in the context of trade associations or other industry groups that exist to promote sharing of information among industry members. Generally, sharing information without any agreement to take uniform action is not a violation of the law, but the lines between legal and illegal conduct can be blurry. The threat of criminal prosecution and the encouragement of competitors to report violations to the DOJ’s hotline make it even more important for HR departments to understand the law in this area. Our firm’s client alert on the subject can be found here, and the recent “Antitrust Guidance for Human Resource Professionals” can be found here.

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Update on Legal Challenges to DOL Regulations

128px-US-DeptOfLabor-Seal_svgThis year, the Department of Labor (DOL) announced new regulations that would double the minimum threshold for a salaried employee exempt from overtime from $455 per week to $913 per week (or $47,476). The regulations also tied the salary threshold to inflation with an automatic adjustment every three years. These changes are scheduled to take effect December 1, 2016, and more details can be found on the DOL’s website, here, or our firm’s client alert on the subject, here.

Recently, there have been two separate legal efforts to stop the increase on December 1. First, the House of Representatives passed a bill on September 28, 2016 that would delay the increase by six months. The bill has not been taken up by the Senate, where its chances of passing are tougher. Regardless of the result in Congress, it is doubtful the President would sign a bill delaying one of his administration’s most important accomplishments (his press secretary has already said it would be vetoed). Put simply, employers should not expect a new law which would delay the December 1 deadline.

The second effort to stop the DOL regulations is a legal challenge filed in a federal court in East Texas by 21 states and more than 50 business groups. Challenging the DOL’s authority to raise the minimum salary threshold, however, is not likely to be successful. The agency has raised the threshold multiple times since the law’s creation, under both Democratic and Republican Presidents. That said, there is a serious legal question regarding whether the DOL has the authority to tie the minimum salary to inflation and create, by regulation, an automatic increase every three years. This is unprecedented, and the court may find that this section of the regulation overstepped the agency’s authority under the law. If that happens, it will be of little value to employers as the December 1 deadline will be unaffected, as the first automatic increase is not scheduled until January 2020.

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New Decision Allows Employee Suit for Violation of Concealed Handgun Law

shutterstock_163763705Texas and many other states in the South have passed state laws in recent years restricting employers from terminating employees who keep their lawfully-licensed concealed handgun locked in their vehicle. For the most part, these laws do not create a private cause of action that would allow a suit for damages against the employer. For example, in Texas, an employee’s recourse would be to file a complaint with the Texas Attorney General.

This week, in a case of first impression, the United States Court of Appeals for the Fifth Circuit (Texas, Louisiana and Mississippi) reversed the dismissal of a wrongful termination claim against an employer and concluded that an employee can sue for damages under Mississippi law. The case is Swindol v. Aurora Flight Sciences Corp., No. 14-60779, and can be found here. Generally, the facts of the case are that Swindol parked his truck on his employer’s lot with his firearm locked inside. Management learned of the gun and fired Swindol for violating its strict company policy prohibiting firearms on company property. This policy, however, was in conflict with state law that allowed Swindol to store his handgun in a locked vehicle on his employer’s property.

The federal court sent a certified question to the Mississippi Supreme Court asking whether it would consider a violation of the state concealed handgun law to be a violation of an important “public policy,” warranting an exception to the employment at will doctrine. The Mississippi Supreme Court answered “yes,” which meant the wrongful termination case could proceed.

Not all states recognize a public policy exception to the employment at will doctrine. For example, Texas does not recognize this exception. But, many do. For that reason, employers should be careful to understand that simply because the relevant statute governing employee gun rights does not provide for a cause of action, that does not mean such a claim is foreclosed.

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Does Your Company Need a Pokémon Policy?


The latest craze is Pokémon Go, an app for smartphones that allows people to “catch” Pokémon creatures by integrating the real world with the virtual world. So what do you do if you see one of your employees wandering around your warehouse hunting a mythical animal, or, even worse, a delivery driver decides to multitask and hunt Pokémon while driving? For those who think such scenarios are unlikely, keep in mind Pokémon Go is now on more phones than Tinder and is chasing Twitter as one of the most popular apps in the world. It is a global phenomenon, and, without a doubt, any good size company has employees who are sneaking onto the app during work hours.

So, what is a company to do? Have we really reached the point of crafting a Pokémon policy? Maybe – but the odds are that your company already has policies that fit the bill – what you really need is a reminder. Here are some areas that deserve mention.

  1. Driving: Playing Pokémon while driving is dangerous. If you have employees who drive on company business, you should already prohibit texting or otherwise using a smartphone while driving.
  2. Playing Pokémon on Company Time: Can your employees spend hours playing cards or surfing the web at work? Probably not. Pokémon is no different and you have the right to discipline employees who are not productive or who use company time for personal leisure.
  3. Safety: Pokémon players “chase” animals while looking at their smartphones. This is not so dangerous in a park, but can be a problem in your warehouse or parking lot. Employees should be reminded that they should be alert at all times while on the premises and that, even off the clock, employees should never lose focus on their surroundings or ignore safety rules.
  4. Phone policy: The Pokémon app allows you to see and “catch” a Pokémon with a phone’s camera, integrating the real world with the Pokémon. This is a neat feature when you take a picture of a cartoon animal in your front yard. Things get a little more complicated when an employee takes a picture of a Pokémon it caught in the conference room and posts the picture on Facebook. Many companies restrict photography in the workplace, and coworkers may not appreciate being part of a coworker’s Pokémon picture. More importantly, a Pokémon hunter walking around the workplace looking at the camera will be disruptive and make some coworkers uncomfortable, fearing they are being recorded.
  5. Trespassing/Off Duty: If your company is lucky/unlucky, it might be a hot spot for Pokémon (a/k/a “Pokéstop”). This could cause off duty employees to hunt Pokémon on your premises, or even bring their children to work after hours. Depending on your property, this could pose safety issues and also violate policies regarding off duty access or trespassing. You should make clear whether off duty Pokémon hunting is acceptable, especially if employees are bringing children to the workplace.

Although some employees will no doubt push the boundaries of acceptable workplace conduct, most employees will follow the rules. Pokémon will come and go, and the workplace will survive. While it is popular, depending on your company’s culture, consider using Pokémon as a team building exercise, or as a way to promote fitness. The new Pokémon app is a social activity, and more enjoyable in groups. Think about organizing Pokémon hunts after work in a local park. You may be surprised at the participation you get from your employees.

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Seminar | The New Overtime Regulations: Practical Strategies and Tips for Compliance

Please join us on Wednesday, July 13, as David Barron, a member of Cozen O’Connor’s Labor & Employment Department, and a panel of Human Resources Professionals from Briggs & Veselka Co., along with other industry professionals, host a seminar on The New Overtime Regulations: Practical Strategies and Tips for Compliance.

The final overtime regulations have been released and it is critical that all employers, large and small, ensure they are in compliance by December 1, 2016. If your business employs exempt salaried employees, you will now be required to pay a minimum annual salary of $47,476 (almost double the old requirement of $23,660) to avoid overtime.

Houston City Club
1 City Club Drive
Houston, TX 77046
Wednesday, July 13

Registration and Breakfast is from 7:30 a.m. – 8:30 a.m.
Seminar from 8:30 a.m. – 10:30 a.m.

CLE credits pending approval.
Please RSVP by Wednesday, July 6.

This seminar will cover:

  • Strategic options for re-classifying exempt employees as non-exempt eligible for overtime;
  • Practical tips from both lawyers and Human Resources Professionals for messaging of re-classification to avoid confusion and potential litigation;
  • Overview of new allowance for up to 10 percent of non-discretionary incentives to be included in salary; and
  • Refresher on all white collar exemptions, and strategies for broader wage and hour audits in light of increased scrutiny

Join us for this comprehensive and informative seminar on regulations that will have a profound impact on every company’s labor costs and the risk for wage and hour litigation. Bring your questions!

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New Overtime Regulations Put Spotlight on Incentive Plans

One of the few concessions made by the Department of Labor (DOL) to employers in the new overtime regulations is permission to count non-discretionary incentive payments towards the minimum salary threshold for exempt employees. Our firm’s alert on the new regulations can be found here, and, in a nutshell, the new rules bump the minimum salary amount for exempt employees from $455 per week to $913, starting December 1, 2016.

To make the huge increase more palatable, DOL will allow employers to count bonuses and commissions towards the minimum salary, but there are important caveats.

  • 128px-US-DeptOfLabor-Seal_svgFirst, the payments must be made quarterly, or more frequently. Annual bonuses won’t count.
  • If you pay more frequently than quarterly, and don’t hit the minimum, an employer may also make a “catch up” payment no later than the next pay period after the end of the quarter.
  • A “catch up” payment only counts against the previous quarter’s salary amount, not the one in which it is paid.
  • The DOL still requires that 90 percent of the salary be fixed, and not dependent upon the quality or quantity of work. Payroll records should reflect the fixed salary separately from any fluctuating incentive payments.

Lastly, and most important, the bonus or commissions must be “non-discretionary.” The regulations define this term as “promised bonuses such as those announced to employees to induce them to work more efficiently or to remain with the firm.” The DOL has given examples such as “individual or group production bonuses, or bonuses for quality and accuracy of work.” See 29 C.F.R. 778.211. I suspect that the amount of litigation over whether incentive plans are non-discretionary will increase dramatically with the new regulations because this analysis could be determinative of whether an employee is owed overtime. Simply, if done properly, the employee is lawfully exempt. If a mistake is made, and the employee’s salary does not otherwise meet the minimum threshold without the incentive payment, overtime would be owed. For that reason, employers relying on this 10 percent provision should make sure they thoroughly review their plans with counsel.

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Is Your Sexual Harassment Training Making Things Worse?

classroomA recent article about a study on the effectiveness of sexual harassment training caught my eye. The article (link here) explains: “Some researchers believe trainings have no positive effects, tend to be more about legal cover than meaningful prevention or may even have unintended consequences – raising serious concerns about the way colleges and companies heavily focus on training as a solution to harassment.” If true, this would mean most organizations are, at best, throwing money away on training and, at worst, potentially encouraging disputes.

Like most things in life, the truth probably lies somewhere in the middle. No doubt, many companies offer perfunctory training with low budget videos or silly examples of inappropriate behavior. If you are wasting people’s time to check off a box on the compliance checklist, everyone will know it. The last thing you want is to have employees ridiculing the effectiveness of the training or viewing the subject as one not taken seriously by the company. The question should not be whether to train or not (you should!) but how to implement training that is practical, timely, and aimed at the appropriate audience.

Here are some tips on how to craft an effective sexual harassment training program:

  1. The training should not just cover sexual harassment! Harassment based on any protected classification is unlawful, and focusing on sexual harassment will only make male employees feel targeted or defensive.
  2. Employees and management should be trained separately. First, the training should be aimed at the appropriate level, and supervisors need to know different information than rank and file employees. Management won’t ask questions in front of their subordinates (and vice versa). Make everyone more comfortable by splitting up these groups.
  3. Hire a qualified and experienced speaker. Playing a videotape or having every employee watch a PowerPoint on a website is cheaper (maybe) but will likely be viewed as a waste of time. Hire someone who is actually interesting and who can give practical examples of what to do/not to do.
  4. Keep it simple – employees (as opposed to management) don’t really need to know the law. The relevant standard is company policy, which is often much stricter than the law. For example, employees don’t need to know the elements of a prima facie Title VII claim or the Latin origin of quid pro quo harassment – they need to be reminded to be careful when texting coworkers of the opposite sex and to be understanding of diverse employees who may not look or talk like them. Similarly, they need to understand the company’s complaint procedure and why it is important – not whether they have a good case to take to a plaintiff’s lawyer.
  5. Make the training interactive, and let employees become invested in the discussion. Ask what they think – you might learn something.
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Schilling Firing: Can You Fire An Employee for What They Say on Social Media?

This week ESPN fired pitcher-turned-broadcaster Curt Schilling for an allegedly offensive tweet about the recently passed law in North Carolina requiring persons to use the restroom associated with the sex of their birth. As an example, transgender men in North Carolina would be required to use the men’s bathroom, and not the female bathroom, even if they dress and live as a female. An article about the firing can be found here.


This case drives home that even a high profile celebrity can be fired for what he or she says on social media. Simply put, with limited exceptions, a private employer can lawfully fire an employee for posting an embarrassing or offensive statement on social media. Government employment is different because of constitutional rights to free speech, but no such rights exist for private employees. What happens on Facebook does not stay on Facebook; and every user of social media should consider the ramifications of their message being read by the Human Resources department or their supervisor.

So what are the exceptions? First, if an employee has an employment contract or collective bargaining agreement limiting termination to “just cause,” employers should proceed with caution. There is little authority that an offensive tweet or Facebook posting meets this standard. The second exception is “protected concerted activity,” which means certain communications among employees about the workplace are protected from retaliation under federal labor laws. As an example, a tweet in support of a $15 minimum wage accompanied by a complaint about the wages earned by the employee, which is “liked” by numerous coworkers, is probably protected. An embarrassing tweet about a poorly dressed customer (think Wal-Mart) would typically not be protected. Lastly, some states have laws protecting employees from retaliation for engaging in lawful activities outside the workplace. Although there is little authority on this point (as the laws were not written to protect this conduct), it is reasonable to expect that lawsuits may be brought in such states against employers who fire employees for engaging in speech outside the workplace that is not otherwise unlawful (i.e. defamatory, threatening, etc.)

Obviously, most political statements by employees won’t make the news because they are not famous like Schilling. That said, HR departments are increasingly being inundated with complaints about insensitive or non-politically correct social media posts by coworkers. This issue is not going away any time soon, so it is important for employers to understand the lines that cannot be crossed.

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“Packing Heat” in the Workplace: The HR Guide to Managing Guns and Violence at Work

firearmI will be speaking at the upcoming monthly meeting of the Texas Bay Area chapter of SHRM on Thursday, April 14, 2016. The meeting will host a luncheon and workshop on the topic of guns in the workplace.

With the recent legislation of “Open Carry” rights in Texas (in addition to the prior “Concealed Carry”), employees have been pushing the boundaries of what is allowed in the workplace.

Employers must manage both the danger presented by employees carrying firearms, and the potential for a workplace violence or terrorist incident in the workplace where an armed employee may be able to save lives.  These are tough choices.

During the luncheon (12:00-1:00), speakers will cover the intersection of gun laws and the workplace, and provide practical suggestions for workplace policies.

During the workshop (1:15-3:00), multiple speakers will delve into common practical and legal issues arising out of workplace violence, and other related issues such as background checks and employer responsibility for violence in the workplace.

In addition to the legal policy perspective, Webster’s Chief of Police Danny Presley will be discussing how to identify and prepare for a violent incident in the workplace.  Also, he will share possible ways to diffuse a violent situation and when to solicit help.

Come join us at the Bay Oaks Country Club, 14545 Bay Oaks Blvd., Houston, TX 77059, on April 14th!

Registration opens at 11:30 a.m. Get tickets here!




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Department of Labor Getting Close to Release of Final Overtime Regulation

128px-US-DeptOfLabor-Seal_svgLast year, the Department of Labor (DOL) announced a proposed regulation to increase the minimum salary threshold for salaried exempt workers from $23,000 to approximately $50,000 and to index the amount to inflation. Understandably, this proposal to double the required salary for overtime exemption was met with great resistance and comment by employers across the country. Many companies have been waiting with baited breath to see what the final proposal will entail, and when it will become effective.

On Tuesday, March 15, 2016, DOL sent its final regulations to the Office of Management and Budget, which is the final step before the rules are announced to the public and become effective. Although DOL officials had publicly announced that the rules would be issued sometime in July of this year, it now looks like that timetable could be pushed up, with the final rules being issued in May or June.

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About HR Headaches
HR Headaches is a blog for Human Resources professionals, business owners, and in-house counsel to get the latest news, analysis and tips in the area of labor and employment law. Every day there are new court decisions, agency interpretations, and regulations which affect the workplace, making it difficult, if not impossible, for many employers to keep current. HR Headaches is dedicated to providing information in a practical, no-nonsense manner to help employers avoid legal disputes and keep policies up to date.
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