Labor Laws in the Obama Era - webinar


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Labor laws change with every administration, and as an employer, keeping up to date is a necessary burden. G. Mark Jodon of Littler Mendelson discusses what has happened and what can be expected during President Obama's administration in terms of labor and employment legislative and executive initiatives. He explores the administration's priorities from both a regulatory and a legislative perspective.

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Labor Laws in the Obama Era - webinar

  1. 1. A New Day In The American Workplace: Labor Law Changes in the Obama Era
  2. 2. G. Mark Jodon, Esq. • Shareholder in the Houston office of Littler Mendelson, the nation’s largest labor and employment law firm. • Mr. Jodon's practice focuses on employment related litigation before state and federal courts, as well as governmental agencies such as the Equal Employment Opportunity Commission, Texas Workforce Commission, Occupational Safety and Health Administration, National Labor Relations Board, and the Wage and Hour Division of the United States Department of Labor. • Mr. Jodon is a frequent lecturer at labor and employment seminars and he conducts HR training workshops
  3. 3. Today’s Agenda • Understand how the shape of the Obama Administration and the New Congress will impact employers • Peek at what is on the legislative and regulatory horizon from a labor and employment perspective • Discuss the potential impact of these changes in the workplace
  4. 4. What We are Going to Discuss... • The New Administration • Legislative Front • Labor Law Agenda • Employment Discrimination Legislation • Work-Family Balance Initiatives • Other Coming Workplace Change
  5. 5. Disclaimer • The presentation is not intended to be partisan • The information presented is factual, based on actual legislation and positions taken by President Obama, members of his administration, and Congressional leadership
  6. 6. The Lay of the Land in DC: The New Administration
  7. 7. The Atmosphere in Washington • Organized Labor, employee advocacy groups, and their allies are very frustrated • Belief that Bush Administration has ignored workers in favor of companies • Reduced enforcement and rule-making in key agencies during Bush Administration • Make up for lost time
  8. 8. The New Secretary of Labor Hilda Solis Hilda Solis
  9. 9. The New Secretary of Labor • Staunch Union Supporter – 97% lifetime rating by AFL-CIO for pro-union voting record – Member of the American Rights at Work Board of Directors • Strong proponents of EFCA • Workplace Safety • Led by former Representative David Bonier (D-MI) – Vocal EFCA proponent
  10. 10. The New Secretary of Labor • First Public Appearance: – AFL-CIO Executive Council meeting – Quote: “There’s a new sheriff in town” – Promised to: • Provide protection to workers in the workplace • Help workers get “family-supporting” jobs • Enforce EFCA
  11. 11. Possible Changes at the DOL • $2 Billion in additional funding this year • Solis has spoken in favor of increased OSHA and MSHA funding • Expect renewed focus on overtime violations and employee misclassification
  12. 12. New Chair of the NLRB: Wilma Liebman
  13. 13. Possible Changes? • National Labor Relations Board (NLRB) – Increased rulemaking activity – Employee Free Choice Act (EFCA)
  14. 14. NLRB Changes • Three vacant seats on NLRB • Obama’s Democratic nominees: – Craig Becker (Associate General Counsel, SEIU) – Mark Pearce (Union-Side Labor Lawyer) • Move to overturn controversial Bush-era rulings: – Temporary Workers – Weingarten Rights for non-union employees – Use of employer e-mail system for union solicitation – Anti-salting cases – Secret-ballot election to reverse card check
  15. 15. Executive Orders Affecting Federal Contractors • 4 have already been issued: – Notification of Employee Rights Under Federal Labor Laws – Non-displacement of Qualified Workers Under Service Contracts – Economy in Government Contracting – Use of Project Labor Agreements in Federal Construction Projects
  16. 16. EEOC • Stuart Ishimaru (Acting Chair) and Christine Griffin (Acting Vice Chair) • Both have lamented the lack of enforcement at the agency
  17. 17. EEOC – What to Expect? • Genetic Information Non-Discrimination Act (GINA) proposed regulations were introduced • Final regulations governing genetic discrimination in employment will be issued soon (i.e. prior to November 21, 2009)
  18. 18. EEOC – What to Expect? • More funding • More enforcement • More regulations / rule-making
  19. 19. The Lay of the Land in DC: The Legislative Front
  20. 20. Setting the Stage in Congress • Democrats regained control of Congress in 2006 after 10 years of Republican rule • Senator Arlen Specter has changed to Democratic Party • Strong belief that “Main Street” was ignored in favor of “Wall Street” • Perception that workers have fallen behind economically and that protections have weakened
  21. 21. President Obama & the 111th Congress • Past is prelude . . . – 110th Congress “road-tested” many of the initiatives we’ll discuss today – Obama vocally advocated for significant change in labor and employment laws – Many significant initiatives have already been introduced – and one has passed (Ledbetter Act) • First 100 Days set the tone • Current economic environment may build popular support for employee “protections” • Are employers in store for a sea of change?
  22. 22. What Does History Tell Us? • Franklin D. Roosevelt’s First 100 Days & Beyond • Political and Economic Situation – Economic situation and shift in party power very similar to today – Organized labor’s role instrumental in election of both FDR and Obama – Congress granted President extraordinary powers to combat Great Depression – Groundbreaking changes intended to reverse the economic devastation in America – job creation and infrastructure initiatives – Labor agreed to set-aside its agenda for the good of the economy and the country
  23. 23. What Does History Tell Us? • Eventual Impact on Employers – Fundamental change in employment laws designed to protect workers and build the middle class: • National Labor Relations Act (right to organize, engage in collective bargaining, and take part in strikes) • Fair Labor Standards Act (established a minimum wage rate, a 40-hour work week, and the requirement to pay overtime)
  24. 24. What is Next? • 5-Way Battle shaping up between: – Organized labor, advocacy groups, and their Congressional supporters – Moderate (DLC/Blue Dog) Democrats and Republicans in Congress – Moderate influences in the Administration – Pro-labor Administration members – Business groups • Let’s look at what they will be battling over . . .
  25. 25. The Labor Law Agenda: A Second New Deal?
  26. 26. Employee Free Choice Act (EFCA) • INTRODUCED ON MARCH 10, 2009 • Changes the National Labor Relations Act (“NLRA”) to: – Permit card check authorization in lieu of secret ballot elections if a simple majority of employees in a selected group signs union authorization cards – Strict time limits on negotiations for initial collective bargaining agreements – Requires mandatory mediation and binding arbitration if time limits are not met – Enhanced penalties for certain violations of the NLRA
  27. 27. What This Means for Employers (if enacted) • Dramatic rise in union organizing • Employees may unwittingly unionize • Ability to negotiate a union contract favorable to the company greatly diminished • Potential legal exposure under the NLRA will expand dramatically
  28. 28. Will EFCA Become Law? • No crystal ball • 10 current Senators failed to co-sponsor EFCA this time • Senators who may not vote for cloture: – Lincoln (D-AR) – Pryor (D-AR) – Feinstein (D-CA) – Bennet (D-COL) – Udall (D-COL) – Carper (D-DEL) – Landrieu (D-LA) – Nelson (D-NE) – Johnson (D-SD) – Specter (D-PA) – Warner (D-VA) • Not enough votes to end a filibuster as of today!
  29. 29. Possible Compromise? • Sen. Arlen Specter (D-PA) under pressure from both sides – has explored compromise in the past • Sen. Specter announced on March 24, 2009 that he will not vote for cloture on EFCA in its present form – Set forth numerous compromise provisions that he would be willing to consider – After switching parties, reaffirmed opposition to current version of EFCA ? • Feinstein/Specter compromise: mail-in ballots instead of card check
  30. 30. Freedom From Union Violence Act of 2009 (H.R. 2537) • Would impose a fine up to $100,000 and/or prison sentence up to 20 years for anyone who commits an act of violence or extortion during a labor dispute • Amends the Hobbs Act • Anti-racketeering measure
  31. 31. RESPECT Act • The Re-Empowerment of Skilled and Professional Employees and Construction Trade Workers ("RESPECT") Act” – Dramatically reduces the number of employees an employer can designate as supervisors – All of the new “non-supervisors” would be eligible to organize and join unions – Potentially large source of new members for unions
  32. 32. Patriot Employers Act • To qualify as a “Patriot Employer” a company would need to: – Be headquartered in the United States – Provide heath care benefits – Adopt a neutral stance toward unionization – Maintain its domestic workforce levels – Subsidize salaries/benefits of employees on active duty in the military – Provide retirement benefits
  33. 33. Other Labor Law Initiatives • Repeal of Right to Work laws – Law in 22 states – Prohibits compulsory payments to unions “Obama and Biden will ensure that his labor appointees support workers’ rights and will work to ban the permanent replacement of striking workers.” -From President Obama’s Campaign Website
  34. 34. The Employment Law Agenda
  35. 35. Employment Law Agenda (from the Obama Campaign Website) • Combat Employment Discrimination • Create a Better Work / Family Balance
  36. 36. Lilly Ledbetter Fair Pay Act • Signed into law on January 29, 2009 • Reaction to Supreme Court Ruling • Amends the Civil Rights Act of 1964 (applies to ADA, and ADEA as well) • Codifies “Paycheck Rule” • Significant expansion of potential liability for discriminatory pay practices • Could significantly increase employers’ record- keeping burdens
  37. 37. Paycheck Fairness Act (H.R. 12, S. 182) • Passed the House on January 9; pending on the Senate’s calendar • Amends Fair Labor Standards Act (FLSA) to allow victims of pay discrimination to potentially recover unlimited punitive and compensatory damages • Prevents employers from relying solely on the “factor other than sex” affirmative defense; Instead, employers must additionally prove that such factor is “job related” and serves a “legitimate business purpose” • Employees could rebut this claim by showing that an alternative employment practice exists that could achieve the same business purpose • Eliminates the requirement that employees work in the same establishment for wage comparison purposes
  38. 38. Employment Nondiscrimination Act of 2007 • Prohibits discrimination based upon actual or perceived sexual orientation • Based on state and local laws already in place in several jurisdictions • No affirmative action requirement • Would not require provision of benefits to unmarried couples
  39. 39. Minimum Wage “Raise the Minimum Wage to $9.50 an Hour by 2011: Barack Obama and Joe Biden believe that people who work full time should not live in poverty. Before the Democrats took back Congress, the minimum wage had not changed in 10 years. As President, Obama will further raise the minimum wage, index it to inflation.” – From President Obama’s Campaign Website Seen as the most direct way to put money in the pockets of the middle class Reflection of what is happening in many states
  40. 40. WAGES ACT (H.R. 2570) • Working for Adequate Gains for Employment in Services Act • Would initially increase tipped employees’ hourly wage from $3.75 to $5.00 • Wages would then increase the following year to be 70% of minimum wage or $5.50/hr (whichever is greater)
  41. 41. Other Civil Rights Initiatives • Major Changes: – Elimination of caps on jury awards for discrimination – Greater awards under the FLSA – Allows undocumented workers to recover damages – Limits mandatory arbitration in employment agreements – avoids a post hoc justification for an employment practice that adversely impacts the wages of women – disparate impact cases under Title VII and ADEA are treated the same
  42. 42. Arbitration Fairness Act of 2009 (H.R. 1020) • Introduced on February 12, 2009 • Would invalidate most employment- related pre-dispute arbitration agreements • Passage unlikely, although it had several (39) co-sponsors • Similar provisions could make their way into civil rights legislation
  43. 43. Servicemembers Access to Justice Act of 2009 (H.R. 1474) • Introduced on March 12, 2009 • Strengthen enforcement of the Uniformed Services Employment and Reemployment Rights Act (USERRA) – Ban pre-dispute arbitration agreements – Increased employer penalties for violations, including compensatory and punitive damage awards, and attorneys’ fees – Clarifies that USERRA prohibits wage discrimination against members of the armed forces – Defines “successor in interest”
  44. 44. Status of the ADAAA Took effect January 1, 2009 • First: Expands the definition of “major life activities” • Second: Prohibits consideration of most mitigating factors in assessing whether an individual is disabled • Third: Allows employees who are “regarded as” disabled to pursue discrimination claims regardless of whether the perceived impairment limits a “major life activities” (unless the impairment is transitory and minor) – Effective Date: January 1, 2009
  45. 45. Work/Family Balance
  46. 46. Work/Family Balance “Obama and Biden will double funding for after- school programs, expand the Family Medical Leave Act, provide low-income families with a refundable tax credit to help with their child-care expenses, and encourage flexible work schedules.” – From the Obama Campaign Website • Expand the Family and Medical Leave Act • Encourage States to Adopt Paid Leave • Protect Against Caregiver Discrimination • Expand Flexible Work Arrangements • Expand Paid Sick Days
  47. 47. National Defense Authorization Act • Signed into law on January 28, 2008 • Includes amendments to FMLA re: Military Family Leave – Military Caregiver Leave – Qualifying Exigency Leave • Regs answer open questions
  48. 48. Expansion/Enhancement of FMLA Expand the Family and Medical Leave Act: The FMLA covers only certain employees of employers with 50 or more employees. Obama and Biden will expand it to cover businesses with 25 or more employees. They will expand the FMLA to cover more purposes as well, including allowing workers to take leave for elder care needs; allowing parents up to 24 hours of leave each year to participate in their children's academic activities; and expanding FMLA to cover leave for employees to address domestic violence. – From President-elect Obama’s Transition Website
  49. 49. Working Families Flexibility Act • Working Families Flexibility Act (H.R. 1274) (introduced March 3, 2009) – Request flexible work options – Interactive process – Denial requires explanation – Employee can file complaint with the DOL – Penalties and federal court review
  50. 50. Family Fairness Act of 2009 (H.R. 389) • Introduced January 9, 2009 • Would eliminate the hours of service requirement under the FMLA • An employee would still be required to have worked for the employer for at least 12 months to be eligible for FMLA leave • Practical effect is that more employees – especially part-time employees – would be eligible to take FMLA leave
  51. 51. Family and Medical Leave Enhancement Act of 2009 (H.R. 824) • Introduced on February 3, 2009 • Would amend the FMLA to allow employees to take parental involvement or family wellness leave – Up to 4 hours of leave in a 30-day period, not to exceed 24 hours in a 12-month period for: • Child’s or grandchild’s school or community organization activities (play, parent/teacher conference, sports event, cub scouts) • Routine dental/medical appointment • Attend to needs of an elderly relative (visits to nursing home) – Applies to employers with 25 or more employees within prescribed radius, not 50 under current law
  52. 52. Family-Friendly Workplace Act (H.R. 933) • Introduced on February 10, 2009 • Would amend the Fair Labor Standards Act to permit private-sector employees to choose comp time in lieu of cash wages • Already in place and popular in the public sector
  53. 53. The Family Leave Insurance Act of 2009 (H.R. 1723) • Introduced on March 25, 2009 • Paid FMLA leave for employees • Administered through a federal insurance fund • Paid for through employer and employee payroll taxes • Applies to any employer who employs 2 or more individuals for more than 20 workweeks • Employees eligible for paid leave after six months • Similar law already in effect in California
  54. 54. Expansion/Enhancement of FMLA • The Family and Medical Leave Expansion Act – Incentive for states to adopt paid leave laws – Smaller employers would have to provide FMLA leave – Adds domestic violence as a cause for taking FMLA leave – Permits a total of 24 hrs of leave during any 12-month period for a parent to “participate in an academic activity of son or daughter...”
  55. 55. Healthy Families Act Expand Paid Sick Days: Half of all private sector workers have no paid sick days and the problem is worse for employees in low-paying jobs, where less than a quarter receive any paid sick days. Obama and Biden will require that employers provide seven paid sick days per year. – From Obama’s Presidential Transition Website
  56. 56. Healthy Families Act • Healthy Families Act (2007) – Employers with 15 or more employees – Mandatory paid sick leave – Private right of action for employees – Carryover from year to year – Posting requirement
  57. 57. Domestic Violence Leave Act (H.R. 2515) • Would amend the FMLA by extending coverage to domestic partners • Would permit leave to address acts of domestic violence, sexual assault and stalking
  58. 58. FMLA Final Rules Effective January 16, 2009 • Change to rules for employees who “age into” eligibility standards • Provides rules for Military Family Leave and defines “exigencies” for National Guard and Reserve Troops • More specific requirements for Serious Health Condition • Employer notice requirements increased • Employee notice obligations slightly more rigorous • Substitution of paid leave: employer may require employee to follow policies and procedures of the applicable leave
  59. 59. Highlights of the Regulatory Changes to the Final Rules • Certification requirements and process – greater clarification and employer permitted to use non-health care provider, other than supervisor, to contact employee’s health care provider for authorization and clarification • Perfect attendance awards now permissible • Fitness-for-duty certification rules permit employer to require certification for employee returning from intermittent leave if there is a risk of harm • Can settle FMLA claims without DOL or court approval
  60. 60. ARRA of 2009: COBRA Revisions • American Recovery and Reinvestment Act of 2009 (“ARRA”) significantly revises group health plan coverage continuation provisions of COBRA • ARRA became effective February 17, 2009, but applies to employees who are “involuntarily terminated” on/after September 1, 2008 and on/before December 31, 2009
  61. 61. Possible Compromise? • Sen. Arlen Specter (D-PA) under pressure from both sides – has explored compromise in the past • Sen. Specter announced on March 24, 2009 that he will not vote for cloture on EFCA in its present form – Set forth numerous compromise provisions that he would be willing to consider – After switching parties, reaffirmed opposition to current version of EFCA • Feinstein/Specter compromise: mail-in ballots instead of card check
  62. 62. ARRA of 2009: COBRA Subsidy • Involuntarily terminated employee may be eligible for a 9-month, 65% reduction in COBRA premiums, provided: – Employee pays 35% of the applicable COBRA premium – Employee otherwise meets the requirements for COBRA coverage (e.g., not eligible if terminated for “gross misconduct” nor if eligible for other group coverage or Medicare) – Premium reduction must be repaid by “high income individuals” (phase-in begins at modified AGI of $125,000 and full repayment obligation kicks in if earn $145,000; higher threshold amounts for joint-filers)
  63. 63. ARRA of 2009: COBRA Subsidy • Once an employee elects COBRA coverage and pays 35% of the premium, the employer must “front” the remaining 65% of the premium • Employer is reimbursed from the employer’s quarterly federal payroll tax transmittals
  64. 64. ARRA of 2009: What Employers Must Do • Identify employees involuntarily terminated on/after September 1, 2008 • Employer must notify individuals who have a qualifying event about the COBRA subsidy • The deadline has passed for notification for those affected prior to February 17th
  65. 65. Other Legislative Changes
  66. 66. FOREWARN Act • FOREWARN Act of 2007 • Changes to WARN: – Covers smaller employers – Lowers the number of employees affected to trigger WARN
  67. 67. FOREWARN Act • Requires an employer to: – Give more notice to employee and the government – Notify the Secretary of Labor – Doubles the penalties for non-compliance
  68. 68. “Blacklisting” of Federal Contractors • Has potential to disqualify many businesses as federal contractors • Potential ways contractors can be “blacklisted” – Unsatisfactory Contractor – Need justification to award contracts to businesses with 2 or more offenses on record – Database to track offenses, including settlements • May be accomplished through Regulations instead
  69. 69. “Blacklisting” of Federal Contractors • Typical current “non- issues” that could cause problems under the blacklisting legislation: – NLRB charges – DOL investigations – OSHA inspections – OFCCP Audits – EEOC charges
  70. 70. RAISE ACT (H.R. 2731 and S. 1184) • Rewarding Achievement and Incentivizing Successful Employees Act • Would amend the NLRA to permit financial incentives beyond the pay or compensation level set in a collective bargaining agreement
  71. 71. The Most Recent Proposals • Breastfeeding Promotion Act of 2009 (H.R. 2819; S.1244) • Wounded Veteran Job Security Act (H.R. 466) • Truth in Employment Act (H.R. 2808; S.1227)
  72. 72. What You Can Do! • Be informed . . . – – Littler’s DC Employment Law Update Blog: – Transition to a New (Work) Day • Take the time to prepare • Plan for change
  73. 73. Question & Answer For More Information: Mark Jodon (713) 652- 4739 or Anthony Grijalva G&A Partners 4801 Woodway, Suite 210 Houston, Texas 77056 (713) 235-8280