Posts by: David B. Smith

CARES Act: What Do Employers Need to Know?

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On Friday afternoon, Congress passed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The Act addresses the coronavirus pandemic by directing funds to address the strains on the health care system as well as alleviate the intense economic stress facing the country’s employers and workers. The President has stated that he will sign the bill immediately. This post focuses on those provisions that may impact employers. Below are answers to some questions that we expect employers will have about the CARES Act.

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Playing the Lottery: The New H-1B Visa Electronic Registration Process

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On January 9, 2020, U.S. Citizenship and Immigration Services (USCIS) formally announced that the much-anticipated H-1B electronic registration process will be implemented for this year’s “H-1B cap” cycle. Accordingly, employers and prospective employers of foreign national employees in the U.S. will need to follow a new process in petitioning for H-1B employment visas and must take note of important updates to filing deadlines.

What is an H-1B Visa?

  • In the realm of U.S. nonimmigrant employment visas, the H-1B is perhaps the most common and coveted. This is likely attributed in large part to the very limited number of U.S. employment visa options available to foreign nationals, including recent STEM graduates of U.S. universities who comprise a coveted talent pool.
  • The H-1B is appropriate for foreign nationals who will work in “specialty occupation” positions in the U.S. (i.e. professional-level roles requiring at least a bachelor’s degree or equivalent in a specific field of study). While there is no bulletproof list of qualifying positions, accountant, lawyer and scientist roles (requiring a degree in accountancy, law and science, respectively) might make a strong specialty occupation case; whereas roles in market research, computer programming and management consulting are likely to receive more scrutiny as to whether a specific degree at the bachelor’s level or higher could be considered a bona fide requirement.

The H-1B “Lottery”

  • Each fiscal year there are 65,000 new H-1B visas available plus an additional 20,000 reserved for holders of U.S. Master’s degrees or higher.
  • Given this numerical limitation, the number of annual applications for the visa from petitioning employers for their employees/prospective employees (“H-1B petitions”) typically greatly exceeds the supply. Indeed, for last year’s H-1B cycle, USCIS received over 200,000 petitions for the 85,000 available visas.
  • Accordingly, H-1B petitions are regularly subject to a randomized lottery conducted by USCIS wherein only a portion of petitions received will be selected for further processing. This visa limit and lottery process are also commonly referred to as the “H-1B cap.”
  • H-1B petitions selected for processing in the lottery then need to undergo a formal adjudication process wherein the merits of the H-1B petition—including the qualification of the offered position as a specialty occupation—will be assessed by USCIS under the “preponderance of evidence” standard. Ultimately, petitions selected in the lottery can either be approved or denied; H-1B denials have increased at a significant rate in recent years.

What is Changing?

  • Historically, petitioning employers were required to submit full hard-copy H-1B petition filing packages within the first few days of April to the appropriate USCIS Service Center. Complete H-1B petitions typically consist of government filing fees, numerous forms completed and signed by the petitioner, a detailed supporting statement outlining the specialty position and the employee beneficiary’s qualifications, and a host of supporting documentation. Assuming USCIS received more petitions than visas available during the first five business days in April, the filing window would then close and the lottery would be run. Petitions that were not selected in the randomized lottery would be returned to employers (or their legal counsel) unadjudicated.
  • Now under the new filing scheme, in lieu of mailing complete H-1B petition filing packages to USCIS in early April, employers (or legal counsel) must electronically register each individual H-1B application it seeks to enter into the lottery between March 1 and March 20, 2020. In the unlikely event ample registrations are not received by March 20, the registration window will be extended.
  • The information collected by USCIS during the new electronic registration process will be limited to basic information pertaining to the petitioning company and employee beneficiary.
  • Assuming ample registrations are received within the aforementioned window, which seems likely, the randomized lottery will then be conducted, and only cases selected in the lottery should then be mailed in full to USCIS for adjudication.

Practical Considerations

  • While many employers may have early April engrained in their head as the standard annual H-1B filing deadline, it is most important to mark March 20, 2020 as the likely drop-dead deadline for entry into the H-1B lottery.
  • Employers should also consider at what point within this window to file their registration(s) for applicable employees. While many may rush to file on March 1, government systems are far from immune to standard IT glitches, and some may prefer to take a wait-and-see approach for any issues that may pop up in early March with this new electronic system.
  • It is most common to issue spot any problems with H-1B petitions through the preparation process. For example, if the job duties of the role can realistically be considered “professional” or if the employee possesses the requisite credentials to qualify for the specialty occupation. Given that minimal information will be collected during the electronic registration process, employers will need to consider how much time to invest in diligence upfront prior to submitting the registrations.
  • While one of the clear benefits of the new electronic registration process is that employers may save the time/costs of preparing voluminous H-1B filing packages that would ultimately not be selected in the lottery for review, employers may nevertheless see benefit in preparing the petitions at present in the background, so they are ready to file the petition with USCIS quickly upon learning of a positive outcome from the lottery.

Ultimately preparation is key, and employers should consider this new process and impact to its workforce now in order to determine a plan of action, manage employee expectations and prepare for any hiccups during this inaugural year of the electronic registration process.

The Saga Continues: EEO-1 Pay Data Collection Extended Again

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Last week, U.S. District Court Judge Tanya S. Chutkan ruled that the EEOC may not discontinue its pay data collection efforts on November 11, 2019, but rather, must continue its collection efforts until it has collected from at least 98.3% of eligible reporters and must make all efforts to do so by January 31, 2020.  The ruling is the latest in a lengthy saga regarding whether EEO-1 Component 2 pay data (data on employees’ W-2 earnings and hours worked across broad job categories, and broken down by ethnicity, race, and sex) would be collected—a saga that began with the Office of Management and Budget staying collection efforts, and culminated last Spring when Judge Chutkan ruled the decision to stay the collection lacked the reasoned explanation required by the Administrative Procedure Act (see overview here).  After vacating the stay, Judge Chutkan initially set the deadline for data collection for May 31, 2019, but later extended it to September 30, 2019. READ MORE →

Use It or Lose It: SCOTUS holds that EEOC Charge-Filing Requirement Is Forfeited If Not Timely Asserted

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On June 3, 2019, the United States Supreme Court issued its decision in Fort Bend County, Texas v. Davis, resolving a circuit split regarding whether Title VII’s charge-filing requirement with the Equal Employment Opportunity Commission (“EEOC”), or equivalent state agency, is jurisdictional. The Supreme Court ruled unanimously that Title VII’s charge-filing instruction is not jurisdictional; rather, it is a procedural prescription which is mandatory if timely raised, but subject to forfeiture if tardily asserted. READ MORE →

Teachable Moment on Equal Pay Act and Title VII as Fourth Circuit Rejects Claim that Professors Perform “Equal” or “Similar” Work

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The Fourth Circuit recently issued a decision discussing whether a university professor established pay-related claims under the Equal Pay Act and Title VII.  This case has important implications for professional occupations where complainants seek to compare themselves to their colleagues for purposes of alleging pay discrimination.

Zoe Spencer, a sociology professor at Virginia State University (“VSU”), sued her employer for allegedly paying her less than two male professors because she is a woman.  The district court granted summary judgment, and plaintiff appealed to the Fourth Circuit.  The Fourth Circuit affirmed the district court’s decision because (1) plaintiff failed to present evidence that creates a genuine issue of material fact that the two male professors are appropriate comparators; and (2) in any event, unrebutted evidence shows that the VSU based the two male professors’ higher pay on their prior service as VSU administrators, not their sex.

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All Aboard! California Law Requires More Female Representation on Boards of Directors

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As part of its effort to close gender-based pay gaps, California will now require companies to increase female representation on boards of directors.

Currently, one in four publicly held corporations in California have no women on their boards of directors. SB 826, which Governor Jerry Brown signed into law at the end of September, requires that all publicly held corporations based in California have at least one woman director by December 31, 2019. That is not the end of the requirements; by December 31, 2021, companies with five authorized directors must have a minimum of two female board members, and companies with at least six directors must have a minimum of three females on the board. The California Secretary of State will publish the names of compliant and non-compliant companies on an annual basis. In addition to the “name and shame” provisions, non-compliant companies face fines of $100,000 for the first violation and $300,000 for subsequent violations.

The sponsors of the bill, Sens. Hannah-Beth Jackson (D-Santa Barbara) and Toni Atkins (D-San Diego), stated when introducing the bill: “More women directors serving on boards of directors of publicly held corporations will boost the California economy, improve opportunities for women in the workplace, and protect California taxpayers, shareholders, and retirees. . . . Yet studies predict that it will take 40 or 50 years to achieve gender parity, if something is not done proactively.”  The bill cites numerous independent studies stating that publicly held companies perform better in terms of profitability, productivity, and workforce engagement when women serve on their boards of directors. It follows the lead of Germany, France, Spain, Norway, and the Netherlands that have addressed the lack of gender diversity on corporate boards by instituting quotas requiring 30 to 40 percent of seats be held by female directors.

Gov. Brown noted in his signing letter that corporations have been considered “persons” for more than a century, so they should reflect the “persons” who make up America as a result.  The California Chamber of Commerce and a coalition of other businesses opposed the bill and argued that the mandate is unconstitutional and a violation of California’s civil rights statutes. While Gov. Brown acknowledged that the law could face legal challenges, he noted that “recent events . . . make it crystal clear that many are not getting the message.” Therefore, he felt signing the bill into law was a necessary measure.  No lawsuits have yet been filed.

In the meantime, California-based publicly held companies should act promptly to ensure that their boards of directors include the number of women directors needed to comply with the statute.

Does Title VII Protect Gay & Transgender Employees? The Supreme Court May Soon Decide.

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As early as November 30, 2018, the U.S. Supreme Court will decide whether to hear three high profile employment cases that question whether Title VII’s ban on sex discrimination protects gay and transgender employees.  These cases have significant implications on the proper scope of Title VII and the rights of the LGBT community in the workplace.

Under Title VII, an employer has engaged in “‘impermissible consideration of … sex … in employment practices’ when ‘sex … was a motivating factor for any employment practice,’ irrespective of whether the employer was also motivated by ‘other factors’.”

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#MeToo One Year Later – Employers’ Responses to the Movement

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On October 15, 2017, the #MeToo movement began in earnest following a tweet by actress Alyssa Milano. To commemorate the one-year anniversary of the #MeToo movement, the Orrick Employment Law and Litigation Blog will analyze the effects of the movement from the employment perspective. Part 1 reviewed the movement’s impact on sexual harassment claims in the workplace, Part 2 focused on the legislative reaction to the movement, and Part 3 below discusses how employers have responded to #MeToo.

Over the past year, the #MeToo movement has caused a seismic shift in our culture that continues to ripple through important aspects of our daily lives, especially the workplace. As we previously discussed, the #MeToo movement’s growing momentum has sparked rising trends in sexual harassment claims and lawsuits, as well as a significant increase in EEOC charges and enforcement efforts. In the past year, the EEOC revealed that it filed 41 lawsuits with sexual harassment allegations, which is a 50 percent increase from 2017. In addition, litigation and administrative enforcement of sexual harassment issues yielded nearly $70 million to the EEOC in 2018, up from $47.5 million the prior year. But newly filed lawsuits or administrative charges only reveal a part of the impact – claims of sexual harassment may have a devastating effect on those accused of wrongdoing and their employers, even if they lie far beyond any applicable statute of limitations, as today’s claims often do. Employers of all shapes and sizes are acclimating their policies and practices for the #MeToo era, as none can avoid the categorical shift in workplace culture that is slowly becoming the “new normal.” READ MORE →

#MeToo One Year Later: The Legislative Reaction

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On October 15, 2017, the #MeToo movement began in earnest following a tweet by actress Alyssa Milano. To commemorate the one-year anniversary of the #MeToo movement, the Orrick Employment Law and Litigation Blog will analyze the effects of the movement from the employment perspective. Part 1 reviewed the movement’s impact on sexual harassment claims in the workplace, Part 2 below focuses on the legislative reaction to the movement, and Part 3 discusses how employers have responded to #MeToo. READ MORE →