The U.S. Supreme Court’s decision in Epic Systems Corp. v. Lewis has significant ramifications for the scope of class action waivers in employee arbitration agreements. In each of the three consolidated cases that the Court’s opinion addressed, the plaintiffs were pursuing class/collective actions with Fair Labor Standards Act (“FLSA”) claims for unpaid overtime. Plaintiff Sheila Hobson’s FLSA claim in the Murphy Oil case had been dismissed by the trial court as a result of the arbitration provision in the employment agreement she signed when she started work at a gas station in Alabama. By contrast, plaintiff Jacob Lewis, a technical communications employee, had overcome a motion to dismiss his FLSA overtime class action in the Epic Systems case by arguing that a class action waiver in an arbitration agreement that had been emailed to him by his employer was unenforceable. In the Ernst & Young case, plaintiff Stephen Morris sought unpaid overtime under the FLSA and the California Labor Code for working long hours during audit season. As a result of the Supreme Court’s ruling, after remand, all of these claims now appear destined for arbitration unless they are resolved. The Epic Systems decision represents a broader affirmation, however, that arbitration agreements are enforceable regardless of the nature of an employee’s claim, even if the claims are brought pursuant to employment statutes that explicitly provide for class or collective actions. Continue reading “The Epic Systems Decision: Where Do Employers Go from Here?”
The #MeToo movement has shone new light on issues for employers in the maritime industry seeking to ensure that seafarers and shore-based personnel can participate in a work environment free of sexual harassment and assault, both shipboard and shoreside. Employees at sea, often for months at a time, can face special challenges associated with a work environment that can be thousands of miles away from any home office, and that can lead to feelings of isolation, make communications difficult, involve close proximity between work spaces and living quarters and generally require employees to remain at the workplace during rest periods.
In other sectors of the global maritime industry, companies engaged in international business can find themselves navigating scenarios that arise from expectations regarding workplace interactions between men and women that are as diverse as their workforces. We examine here the unique legal framework that applies to sexual harassment in the maritime context, what to keep in mind for addressing incidents and recent trends regarding steps employers are currently taking in response. Continue reading “What #MeToo Means for the Maritime Sector”
The Supreme Court issued a landmark decision on May 21, 2018, which has widespread implications for all employers. In Epic Systems Corp. v. Lewis, a 5-4 opinion written by Justice Gorsuch, the Supreme Court held that arbitration agreements and class/collective action waivers are enforceable, putting to rest any argument that the National Labor Relations Act prevents or limits their enforceability. The decision provides employers further options for limiting litigation risk, particularly with respect to costly wage and hour collective actions. The decision also contains important implications for employers that maintain or are considering implementing arbitration agreements in the workplace, as there is no longer any identified legal impediment to the concept of an employer requiring its employees to waive the ability to bring a class or collective action under federal, state, and local employment laws. Continue reading “Epic Shift: Supreme Court Enforces Class Action Waivers in Arbitration Agreements”
California employers are facing a harsh new reality as a result of the state Supreme Court’s recent decision adopting a new test for determining whether a worker can properly be classified as an independent contractor (versus an employee) “for purposes of California wage orders,” which generally impose obligations on employers relating to non-exempt employees’ wages, hours, and working conditions like meal periods and rest breaks.
The underlying claims were brought by two delivery drivers alleging Dynamex, a nationwide same-day courier and delivery service, had improperly classified them and other “similarly situated” drivers as independent contractors. In relevant part, these drivers:
- were paid a flat fee or percentage of the delivery fee received from the customer;
- were generally free to set their own schedules;
- were free to reject or accept jobs assigned by Dynamex;
- used their own cell phones and vehicles for work;
- were free to choose their own routes;
- could perform work for other companies; and
- were hired for an indefinite period of time.
Under most tests distinguishing independent contractors from employees, these facts would have weighed toward an independent contractor determination. However, in a densely-academic, 82-page opinion, the Court held that the “suffer or permit to work” definition of “employ” contained in the wage orders should replace the more flexible “right of control” test which has been used in California since 1989. Specifically, the Court adopted the “ABC” test as the proper way to distinguish employees from independent contractors. Continue reading “Independent Contractors in California—Misclassification Is Now “Easy as ABC””
In the March 7, 2018 edition of the blog, we reported that as a result of a change in the 2017 tax legislation relating to the calculation of the cost of living adjustment to the annual dollar limit on contributions to a health savings account (“HSA”), the Internal Revenue Service (“IRS”) had announced that the maximum amount that may be contributed for 2018 to an HSA by an individual who has family coverage under a high deductible health plan was being reduced from $6,900 to $6,850.
The IRS previously had announced that the 2018 limit was $6,900 and, predictably, the possibility of having to address the $50 cutback presented employers and HSA custodians with a fair measure of administrative complexity both as to individuals who had already contributed $6,900 and those who had made salary reduction elections based upon the $6,900 limit. Continue reading “The IRS Says Never Mind to the Retroactive Reduction in the 2018 Limit for Contributions to a Health Savings Account”
Maryland’s legislature recently passed Senate Bill 1010 in an effort to provide victims of sexual harassment additional workplace protections. The Bill awaits the governor’s signature.
Set to be effective October 1, 2018, and titled “Disclosing Sexual Harassment in the Workplace Act of 2018” (the “Act”), the Act voids any provision in an employment contract, policy, or agreement that waives substantive or procedural rights or remedies relating to a sexual harassment claim that accrues in the future, or to a retaliation claim for reporting or asserting a right or remedy based on sexual harassment (unless prohibited by federal law). Any employer who enforces, or attempts to enforce, such a provision will be liable for the employee’s attorney’s fees and costs. The Act will apply to any employment contract, policy, or agreement executed, “implicitly or explicitly extended,” or renewed on or after the effective date; so, it seems to cover policies and agreements implemented prior to October 1, 2018 that continue in place after that date. Continue reading “New Maryland #MeToo Bill Sets Up Public Shaming and Restrictions”
On April 12, New York Governor Andrew Cuomo signed into law a budget bill that includes significant changes in the obligations of New York employers related to sexual harassment (the “Anti-Harassment Law”). According to the Governor, the Anti-Harassment Law provides the “strongest and most comprehensive anti-sexual harassment protections in the nation,” as part of a hefty $168 billion budget deal for the 2019 fiscal year (which started April 1, 2018). The Anti-Harassment Law is consistent with a recent push by states and localities to expand employee protections against unlawful harassment in response to the #MeToo movement.
The Anti-Harassment Law includes both immediate and ongoing implications. Here are some of the highlights: Continue reading “New York Says “#MeToo” as It Enacts Strict Anti-Harassment Measures”