Top 5 Federal L&E Developments From the Past Year
With many of President Trump’s agency nominations being held up in the Senate, followed by the longest government shutdown in history, it’s been a relatively quiet year for labor and employment law at the federal level. Nonetheless, here are my picks for the most significant developments of the past year.
No. 1: #MeToo. Although a little of the furor seems to be dying down, the #MeToo movement had a big impact on employment law in 2018. The Equal Employment Opportunity Commission reported an almost 13 percent increase in charges alleging sexual harassment in Fiscal Year 2018, which ended September 30, 2018. Now that the agency is back up and running, it will be interesting to see what happens in FY 2019. Although North Carolina has not yet followed the nationwide trend of banning non-disclosure provisions in sexual harassment settlements or mandating employee harassment training, many employers here are already voluntarily adjusting their policies, procedures, and training.
No. 2: LGBT rights. Last summer, the U.S. Supreme Court found in favor of Jack Phillips, the owner of Masterpiece Cakeshop who refused, for religious reasons, to make a wedding cake for a same-sex wedding. The Supreme Court’s ruling was narrow: It was based on the fact that the Colorado Commission on Civil Rights displayed an anti-Christian bias that tainted its ruling against Mr. Phillips. In other words, it is not much of a “landmark” regarding the weight to be given to LGBT rights when they conflict with a business owner’s religious exercise and belief. Interestingly, Mr. Phillips is now the plaintiff in a lawsuit against the Colorado Commission. After a separate incident in which Mr. Phillips refused to bake a cake to celebrate the transition of a transgender woman, the Commission ruled against him again and issued an administrative complaint. In response, Mr. Phillips sued the Commission, alleging that it has violated his rights under the First and Fourteenth Amendments to the U.S. Constitution. That lawsuit is still in the very early stages, but a federal judge recently denied the Commission’s motion to dismiss the suit.
I wrote in November about Bostock v. Clayton County, Altitude Express v. Zarda, and R.G. & G.R. Harris Funeral Homes v. EEOC – three cases related to whether LGBT discrimination is “sex” discrimination within the meaning of Title VII of the Civil Rights Act of 1964. As this post was written, the Supreme Court had not yet decided whether to review those cases.
No. 3: NLRB trying to become more employer-friendly. In June 2018, the General Counsel of the National Labor Relations Board issued guidance indicating that the Board would allow employers to impose reasonable civility, confidentiality, and social media rules, and other relatively routine employment policies that were frequently found during the Obama Administration to have a “chilling effect” on employees’ exercise of their rights under Section 7 of the National Labor Relations Act.
The Trump Board also issued a joint employer decision, Hy-Brand Industrial Contractors, in late 2017 that was welcomed by employers. However, the Board vacated Hy-Brand after the Inspector General for the NLRB found that Member William Emanuel should have recused himself because his law firm represented one of the parties to Browning-Ferris Industries, the case that Hy-Brand overruled. Down but not out, the Board chose to issue joint employer regulations to accomplish the desired change in the standard. But meanwhile, a panel of the U.S. Court of Appeals for the District of Columbia Circuit for the most part sided with the Obama Board in Browning-Ferris and has arguably indicated that the Trump Board’s proposed joint employer regulations may be invalid. We expect the current Board to issue a final rule on joint employment anyway, and also to seek en banc or Supreme Court review of the Browning-Ferris decision.
No. 4: Overtime regulations. The U.S. Department of Labor is in the process of issuing proposed regulations regarding a new salary threshold for the executive, administrative, and professional exemptions from the overtime requirements of the Fair Labor Standards Act. Currently, the threshold set during the Bush Administration in 2004 is still in effect – only $455 a week ($23,660 a year). The Obama Administration issued regulations that would have more than doubled that, but those regulations were enjoined in late 2016. The Trump Administration is reportedly going to raise the threshold to about $30,000 a year. (The DOL is also expected to issue regulations on its own “joint employer” standard for purposes of the laws enforced by the DOL.)
No. 5: EEOC wellness regulations rescinded. In May 2016, the EEOC under the Obama Administration issued regulations addressing when employers could offer incentives to employees and their family members for participating in wellness programs, without running afoul of the confidentiality provisions of the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act. Both of those laws provide that medical or genetic information can be requested in connection with a voluntary wellness program. The issue is whether incentives for participation (for example, a significant reduction in the employee’s share of health insurance premiums) mean that the program is not “voluntary.” If incentives render the program not voluntary, then a request for medical or genetic information would violate the ADA or the GINA.
After the EEOC issued its regulations, the AARP filed suit in federal court in the District of Columbia, claiming – among other things – that the regulations did not sufficiently protect employees and their family members from being pressured to disclose their confidential medical and genetic information. The judge agreed, and vacated the regulations. However, he stayed his order until January 1, 2019, to allow the EEOC the opportunity to issue revised regulations.
Presumably because the EEOC has no General Counsel and only two Commissioners, the agency was unable to issue amended regulations, and in late December the regulations were rescinded. The EEOC’s regulatory agenda currently says that new proposed regulations will be issued in June.