Sportswear-inspired designs, bold prints, and gingham aren’t the only things trending for Spring 2015 in the fashion world. Judging from a recent wave of lawsuits, wage and hour class actions are trending as well. Over the past few years, class action lawsuits over unpaid internships have been on the rise, with this most recent wave of filed lawsuits serving as a powerful reminder to employers that intern programs can’t simply be viewed as a way to recruit free labor.
As employers in New York were gearing up for distribution of the annual wage notices in January 2015, Governor Andrew Cuomo finally signed the amendment to New York’s Wage Theft Prevention Act that was passed by the legislature back in June and repeals the annual wage notification provision. While the other amendments to the Act will not take effect for 60 days, the Governor’s December 29, 2014 signing statement and the New York Department of Labor make clear that employers are not required to distribute wage notices to their employees this January. The amendment, however, does not relieve employers of their obligation to provide all newly hired employees with wage notices at the time of hiring. In addition, although not specifically addressed in the amendment to the Act, it would be prudent for employers to distribute a revised wage notice when an employee receives a new position with a different compensation structure during his or her tenure with the employer.
On December 3, 2014, the U.S. Department of Labor (DOL) released its final rule barring federal contractors from discriminating on the basis of sexual orientation and gender identity. The final rule implements an Executive Order signed by President Obama in July 2014 amending Executive Order 11,246 to include sexual orientation and gender identity as prohibited bases of employment discrimination by federal contractors and subcontractors.
On November 12, 2014, the Fifth Circuit affirmed a Department of Labor finding that Halliburton retaliated against a whistleblower by including his name in a document preservation notice. The court also held that emotional distress damages are available under SOX.
In Halliburton, Inc. v. Administrative Review Board, the whistleblower, Anthony Menendez, claimed that he was ostracized and isolated in violation of SOX after Halliburton’s General Counsel sent out a litigation hold notice stating that the SEC had opened an investigation into concerns raised by Menendez about alleged accounting improprieties. Menendez had previously raised these concerns internally to management.
On October 10, 2014, the White House hosted a listening session regarding President Obama’s “Fair Pay and Safe Workplaces” Executive Order (discussed in detail in a prior Orrick Employment blog post here), one of many new laws imposing significant new requirements on federal contractors. Representatives of the Professional Services Council met with Secretary of Labor Tom Perez and White House officials to urge changes to the Order, which (among other things) requires prospective federal contractors and subcontractors to track and report a comprehensive list of labor and employment law violations, bars larger existing contractors from requiring pre-dispute arbitration agreements of certain claims (including claims under Title VII), and requires contractors to provide employees with additional information on overtime and hours worked in paychecks. Read More
On Tuesday, August 19, 2014, the U.S. Department of Labor issued a directive to “clarify that existing agency guidance on discrimination on the basis of sex . . . includes discrimination on the bases of gender identity and transgender status.” This directive follows President Obama’s Executive Order 13672, issued on July 21, 2014, amending existing orders to specifically prohibit federal contractors from discriminating based on gender identity.
On April 15, 2014, a California appeals court ruled that after an employee returns to work from leave under the Family and Medical Leave Act (FMLA), an employer can require a medical reevaluation related to the health condition for which the employee was granted FMLA leave, so long as it is job related and consistent with business necessity. Read More
Last week President Obama continued his administration’s push to tackle pay equity issues by taking executive action to put federal contractors’ compensation practices under greater scrutiny. On April 8, 2014, the President signed a memorandum and executive order designed to address race and gender-based disparities in compensation. The memorandum directs the Department of Labor (“DOL”) to propose a rule within 120 days requiring federal contractors and subcontractors to submit “summary data” on employee compensation by race and sex to the DOL using a “tool” to be developed by the agency. The executive order signed along with the memorandum bans federal contractors from retaliating against employees for discussing their compensation with each another in an effort to “enhance the ability of Federal contractors and their employees to detect and remediate unlawful discriminatory practices” in pay. Read More
Yesterday, in Lawson v. FMR LLC, a divided U.S. Supreme Court decided its first case addressing the whistleblower protections of the Sarbanes-Oxley Act (SOX). The question before the Court: do those protections extend only to the employees of public companies, or do they also reach the employees of contractors and subcontractors of public companies? You can see our prior posts on the case here (June 19, 2012), here (October 8, 2013), here (January 7, 2014), and here (January 28, 2014). Read More
A whistleblower who took sensitive company data from his employer and turned it over to the IRS has won his retaliation claim at the Department of Labor under the Sarbanes-Oxley Act’s (“SOX”) whistleblower protection provisions. In Vannoy v. Celanese Corp., ALJ Case No. 2008-SOX-00064, ARB Case No. 09-118 (ALJ July 24, 2013), an Administrative Law Judge was presented with the question of whether Vannoy’s removal of highly sensitive company data and transmission of that data to the IRS constituted protected activity under SOX. Vannoy, who was formerly employed as the administrator of Celanese’s corporate credit card program, first allegedly complained internally that the company “misstated their financial records and underestimated their required tax burden potentially in millions.” Vannoy sought legal counsel and eventually reported the company’s alleged accounting misconduct to the IRS. Read More