Employment Law Changes

federal-employment-lawIn this past year, 2015, the U.S. Supreme Court issued a number of important employment law decisions. Federal employment law agencies such as the Department of Labor, the Equal Employment Opportunity Commission (EEOC) and the National Labor Relations Board (NLRB) published rules and guidance that significantly impact employer compliance in a number of key areas.

In many instances, these positions go way beyond “cutting edge” and transcend into unprecedented interpretation of the “law.” Circuit Courts have begun to sharply criticize such interpretations of federal employment law and to overrule administrative positions, at times awarding significant attorneys’ fees to employers that were vindicated on the appellate level.

To avoid unintended legal exposure and liability, employers should be sure to stay updated on all of the legal changes that took place in 2015. Here is a brief review on these updates:

Sexual orientation discrimination

In a novel ruling, the Equal Employment Opportunity Commission (EEOC) held that Title VII of the Civil Rights Act of 1964 prohibits sexual orientation employment discrimination in the workplace.

Even though the courts have not yet sanctioned the EEOC’s position, the agency is likely to aggressively enforce its new interpretation.

Overtime rules

In July, the Department of Labor (DOL) published its highly anticipated proposals for updated overtime rules.

The proposed rule would set the standard salary level at the 40th percentile of weekly earnings for full-time salaried workers ($921 per week, or $47,892 annually); increase the total annual compensation requirement needed to exempt highly compensated employees to the annualized value of the 90th percentile of weekly earnings of full-time salaried workers ($122,148 annually); and establish a mechanism for automatically updating the salary and compensation levels going forward to ensure that they will continue to provide a useful and effective test for exemption.

Worker misclassification

This summer, the Department of Labor (DOL) also published guidance on worker misclassification in which the agency suggested that “most” independent contractors should be legally classified as employees.

The DOL’s broad interpretation of “employee” under the Fair Labor Standards Act (FLSA) suggests that worker misclassification will continue to be a top compliance concern.

Religious discrimination

In Equal Employment Opportunity Commission v. Abercrombie & Fitch Stores, Inc., the U.S. Supreme Court held that an employer can be held liable for failing to accommodate a religious practice under Title VII of the Civil Rights Act of 1964 even through the employee has not made an express request.

Specifically, an applicant need only show that his need for an accommodation was a motivating factor in the employer’s decision. The decision made it easier for employees to prove religious discrimination in the workplace.

Pregnancy discrimination

In Young v. UPS, the U.S. Supreme Court held that employees could establish a prima facie discrimination case under the Pregnancy Discrimination Act case by providing sufficient evidence that the employer’s policies impose a significant burden on pregnant workers.

Plaintiffs must also show that an employer’s “legitimate, nondiscriminatory” reasons are not sufficiently strong to justify the burden, but rather—when considered along with the burden imposed—give rise to an inference of intentional discrimination. In the wake of the decision, the EEOC published revised guidance.

Gary S. Young concentrates his practice on ERISA, employee benefits and executive compensation as a member of Scarinci Hollenbeck’s Corporate Transactions and Business Law Group. Gary began his legal career almost 40 years ago as a traditional labor lawyer, and he continues to provide employment law advice to private sector employers on subjects such as wage & hour compliance, workplace harassment, FMLA, etc. For more information on the firm, please visit the firm’s website at www.scarincihollenbeck.com.

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