Legislative Developments

transgender1600A few recent events provide employers a peek behind the curtain of the Trump administration’s position on whether Title VII provides protection to LGBT individuals.

First, some background. Title VII prohibits discrimination “because of sex,” among other things. In the past, the Equal Employment Opportunity Commission (the federal agency enforcing federal anti-discrimination laws) acknowledged that Title VII did not cover sexual orientation discrimination, although it did prohibit discrimination based on sex/gender stereotyping (which could overlap with sexual orientation claims to the extent the gay or lesbian employee did not conform to male or female stereotypes). Continue Reading What is the Future of Sexual Orientation and Transgender Status Under the Trump Administration?

JohnHancockAs an employment litigator, I have repeatedly emphasized to my clients the need to get signed agreements, acknowledgements, and authorizations from employees. From a legal standpoint, these signed documents provide legal certainty (and frequently an absolute defense) to certain employee interactions and claims. For example, if an employee contends that she was unaware of the complaint procedure for a harassment claim, waving her signed acknowledgement form for the handbook that contains that procedure in front of her is a pretty stellar defense (and quite satisfying)! It’s hard for someone to repudiate their own handwritten “John Hancock.” Continue Reading Electronic Signatures v. Handwritten Signatures

auction-gavel-HpmTks-clipartAs you may remember, Shawe Rosenthal joined with other law firms in Worklaw® Network in a lawsuit against the U.S. Department of Labor to block its implementation of the controversial “persuader rule” in order to protect your right to seek counsel on employment, labor and HR matters with privacy and confidentiality. Here’s a brief recap of the milestones: Continue Reading Persuader Rule Lawsuit Update

Today, December 1, 2016, the Department of Labor issued a press release announcing that it had filed an appeal to the U.S. Court of Appeals for the 5th Circuit of the emergency nationwide injunction of the new overtime rule, which had been granted last week by Judge Amos Mazzant, as discussed in our November 23 blog, “Overtime Rule Will Not Take Effect on December 1.” The preliminary injunction temporarily blocked the DOL’s new rule raising the required minimum salary level for the Fair Labor Standards Act’s white-collar exemptions from the requirement to pay overtime pay. The rule was set to go into effect on December 1st.

As discussed in our May 18, 2016 E-lert, in order to be exempt from overtime, a white-collar employee must meet three tests: (1) the salary basis test – the employee must be paid on a salary basis, not subject to reductions for fluctuations in quantity or quality of work; (2) the salary level test – the employee’s salary must currently be at least $455 per week (equaling $23,660 per year); and (3) a duties test – the employee must perform certain duties specific to the executive, administrative or professional exemption in question.  There is also a highly-compensated employee exemption under which an employee must currently make at least $100,000 per year and perform at least one exempt duty.

The DOL’s revised rule would have doubled the salary requirement for white collar (executive, administrative and professional) employees from $23,660 per year ($455 per week) to $47,476 per year ($913 per week).  The required minimum salary for the highly compensated employees’ exemption would also have been raised from $100,000 to $134,004. These salary levels would have been subject to automatic adjustments every three years. The new rule did not change the duties test for any of the exemptions.

The new rule was challenged by 21 states and multiple business groups, arguing that such change was unlawful. In issuing the preliminary injunction, the judge agreed, noting that the rule change “creates essentially a de facto salary-only test,” which Congress had not intended. In the press release, however, the DOL stated, “The Department’s Overtime Final Rule is the result of a comprehensive, inclusive rule-making process, and we remain confident in the legality of all aspects of the rule.”

auction-gavel-HpmTks-clipartA federal judge in Texas has issued a preliminary injunction that prevents the Department of Labor’s revised overtime exemption rule from taking effect as scheduled on December 1, 2016.

As discussed in our May 18, 2016 E-lert, in order to be exempt from overtime, a white-collar employee must meet three tests: (1) the salary basis test – the employee must be paid on a salary basis, not subject to reductions for fluctuations in quantity or quality of work; (2) the salary level test – the employee’s salary must currently be at least $455 per week (equaling $23,660 per year); and (3) a duties test – the employee must perform certain duties specific to the executive, administrative or professional exemption in question.  There is also a highly-compensated employee exemption under which an employee must currently make at least $100,000 per year and perform at least one exempt duty. Continue Reading Overtime Rule Will Not Take Effect On December 1

gavel-1238036The U.S. District Court in Minnesota ruled, on June 22, 2016, that the Department of Labor’s new interpretation of the advice exemption from the persuader rule is “untenable” and “flawed.”   The Court did not issue an injunction against the new interpretation, which goes into effect July 1, 2016, but that was based on its finding that the DOL suspended the most objectionable reporting requirement after the lawsuit was filed.  The challenge to the new interpretation was filed by Worklaw Network, a national alliance of labor and employment firms of which we are a member.  Our firm, along with Seaton, Peters & Revnew, P.A. of Minneapolis, represented Worklaw, as we discussed in a prior post, “Shawe Rosenthal and Worklaw Just Sued the DOL.” Continue Reading Court Finds DOL’s New Persuader Rule “Flawed”

male-709687_640This week, the EEOC issued a Fact Sheet regarding Bathroom Access Rights for Transgender Employees under Title VII of the Civil Rights Act of 1964, which the EEOC has stated prohibits discrimination on the basis of gender identity.  Title VII applies to all federal, state, and local government agencies in their capacity as employers, and to all private employers with 15 or more employees.

In siding with other federal government agencies that have released similar guidance (OSHA, the Office of Personnel Management, and the Department of Education), the EEOC stated that an employer should allow an employee to use the bathroom that corresponds with the employee’s gender identity. Continue Reading The EEOC’s Fact Sheet on Transgender Access to Bathrooms

The Maryland 2016 legislative session endedshadow-dollar-sign-1239535 on Monday.  A friend of mine mentioned that she heard the General Assembly passed an equal pay law in Maryland. But guess what? There is already an Equal Pay for Equal Work law in Maryland – it’s been in place for almost 25 years!! The current law already prohibits employers from discriminating against employees of one sex who work in the “same establishment” and perform work of comparable character or work in the same operation, in the same business, or of the same type by paying a lesser wage than an employee of another sex.

The equal pay bill mentioned, House Bill 1003, expands the prohibitions on discriminatory pay practices. It also adds an entirely new pay transparency provision. Specifically: Continue Reading “New” Equal Pay Bill for Maryland

Equal pay has become a hot topic on both the state and federal levels. As a woman who is a management-side employment attorney, I sometimes find myself puzzled as to how this topic came to be such a hot button issue, especially since there are already many laws on the books that address equal pay.

On the federal level, we have the Equal Pay Act, Title VII, and the Lily Ledbetter Fair Pay Act, which are enforced by the Equal Employment Opportunity Commission (EEOC). For federal contractors, there are Executive Orders 11246 (affirmative action for women and minorities), 13665 (pay transparency), 13673 (fair pay and safe workplaces), and a Presidential Memorandum on equal pay, all of which are enforced by the Office of Contract Compliance Programs. In Maryland, we have the Maryland Civil Rights Act (the equivalent of Title VII) and the Equal Pay for Equal Work Act. All of these are designed to address and enforce equal pay, regardless of sex or other protected characteristics.

However, just last month, on the 7th anniversary of the signing of his very first law while in office (the Lily Ledbetter Fair Pay Act), President Obama announced that the EEOC was issuing a new rule that would change the EEO-1 reporting requirements for employers with 100 or more employees and for government contractors with more than 50 employees and more than $50,000 in federal contracts or subcontracts. Under the proposed rule, these employers would need to report aggregated data on pay and hours worked by pay bands. A summary of the proposed rule can be found here.

Here in Maryland, there are currently a number of bills pending in the Maryland General Assembly that either amend the Equal Pay for Equal Work Act (to the detriment of employers by either instituting treble damages or other fines and penalties) or create an entirely new Equal Pay Commission, both of which seek to impose more reporting requirements on employers.

While I understand and support the underlying principles of the proposed legislation and regulations, issues arise in instituting these reporting obligations on employers. In addition to the effort and time required for collecting and reporting the data, such reported data does not fully capture the non-discriminatory differences between two individuals. A true assessment of equivalent jobs and the people in those jobs requires a thoughtful and detailed analysis of a multitude factors, including – but certainly not limited to – the following:

  • Performance;
  • Skills;
  • Responsibilities;
  • Seniority;
  • Job knowledge;
  • Industry knowledge;
  • Certifications or licenses;
  • Prior experience;
  • Level of education;
  • Negotiation of starting salary;
  • Salary at prior jobs;
  • The choices individuals make with respect to child rearing or other responsibilities (e.g. choosing to work part time, or not to work overtime, or flexible careers with less earning potential);
  • Market competitiveness;
  • Geographic location.

This nuanced and individual-specific analysis isn’t readily apparent from cold, limited data. I am apprehensive that mandatory reporting will only create more issues for employers when any of these established or potential enforcement agencies come knocking on employers’ doors seeking explanations for what appears to be facially discriminatory – but is not, in fact.

Aside from the significant effort and resulting headaches associated with compiling and reporting the data, another major concern stems from what will happen with this data after it is submitted. The EEOC says that it will use the data to assess complaints of discrimination, focus agency investigations, and identify pay disparities, as well as encourage companies to engage in self-assessment and correction. But questions still remain as to what the EEOC’s evaluation of this data will truly look like. Will it take into account differences in geographic locations, such as cities versus rural areas? Northeast v. Midwest? What about industry distinctions, or non-profit v. for profit institutions? Company size?

And frankly, the data being sought is very similar to what was required by the Equal Opportunity Survey, which was used by the OFCCP from 2000-2005 to collect personnel data, including compensation information, from federal contractors. The EO Survey was abandoned in 2006, after an independent consulting group found that it was ineffective in identifying systemic discrimination!

I am also concerned about the security of this data. We all know that the government isn’t immune from being hacked, so how will the data be submitted in a secure fashion? What will be the fate of this data after it is submitted? Will competitors learn of your wage rates and then attempt to lure away your best employees with an offer of higher pay?

It’s not that I am against equal pay. Indeed, as a woman, that would be just plain ridiculous (of course I want to be paid the same as my equally situated counterparts!). Similarly, I support equal pay for minorities. The point I’m making as a management-side employment attorney is that there are already laws and agencies in place to address equal pay issues. Enacting more laws (with more obligations on employers) and creating even more governmental agencies tasked with investigating discrimination in pay (to no actual effect!), when there are already agencies that do that, is redundant and unnecessarily burdensome on employers.

On January 29, 2016, President Obama announced a series of actions intended to close the gender pay equity gap, including proposed revisions to the EEO-1 form that would require the submission of detailed pay information.

As President Obama stated in his press conference, and as set forth in a White House Fact Sheet, “New Steps to Advance Equal Pay on the Seventh Anniversary of the Lilly Ledbetter Fair Pay Act,” the Equal Employment Opportunity Commission today issued a proposed rule to expand the information collected on the EEO-1 form. The EEO-1 form must be submitted annually in September by (1) employers with more than 100 employees and (2) government contractors with more than 50 employees and more than $50,000 in federal contracts or subcontracts. It requires employers to provide information regarding the race, ethnicity, sex, and job category of their workforce. The proposed revision would add the requirement to provide aggregated data on pay and hours worked, broken down into pay bands by the same race, ethnicity, and sex categories. According to the EEOC’s press release on the EEO-1 revisions, the EEOC and the OFCCP will use the submitted data to analyze pay disparities across industries and occupations, and facilitate federal antidiscrimination actions. In addition, EEOC will publish aggregated data that employers can use in their own voluntary compliance efforts. Continue Reading President Obama Radically Expands EEO-1 Reporting Requirements