Law and the Workplace

Report from EEOC Hearing on EEO-1 Component 2—Should It Stay or Should It Go?

On November 20, 2019, the EEOC held a public hearing at its headquarters in Washington, DC, regarding proposed changes to the Employer Information Report (“EEO-1”). These proposed changes include “not seeking to renew Component 2 of EEO-1,” which required employers with over 100 employees to report employee pay and hours worked information. Proskauer attended the two hour hearing.

The purpose of the hearing was to gather information on the proposed changes and to assess the benefits and burdens of using the EEO-1 to collect Component 2 data. During the hearing, the Commission’s members emphasized the importance of tackling pay disparity, but questioned whether collecting Component 2 pay data is the best way to address the problem.

The Commission heard testimony from the following panelists: Lynn Clements from Berkshire Associates, Michael Eastman from the Center for Workplace Compliance, Jocelyn Frye from the Center for American Progress, Joshua Mitchell from Welch Consulting, Jessica Stender from Equal Rights Advocates, and Betsey Stevenson from the Gerald R. Ford of Public Policy at the University of Michigan.

Clements and Eastman, both of whom have helped employers prepare Component 2 pay data, spoke of the burdens their clients faced in assembling the Component 2 data. Mitchell, likewise, discussed the burden Component 2 places on employers and its lack of utility in targeting employers engaged in discriminatory pay practices. By comparison, Frye, Stevenson and Stender spoke in support of continuing to use the EEO-1 to collect Component 2 data and disagreed with statements that had been made regarding the burdens of collecting the required pay data. Stevenson and Stender criticized the prospect of the Commission discontinuing its use of the EEO-1 to collect Component 2 data before analyzing the 2017 and 2018 data it has already received.

In her closing statement, Chair Dhillon stated that, in making its decision regarding the proposal, the Commission would take into account the panelists’ testimony and public comments. Commissioner Lipnic’s final comments highlighted the Commission’s need to consider how to best use its scarce resources to combat the wage gap. She also discussed how, in analyzing the efficacy of Component 2, the Commission could use the 2017 and 2018 Component 2 data it has already collected from employers. Finally, Commissioner Burrows’ closing statement focused on the fact that the Commission’s work in rooting out pay discrimination has been hampered by a lack of information and that pay gaps continue to persist.

We will continue to monitor developments on the EEO-1 front and report them here.

Nevada Labor Commissioner Issues Advisory Opinions Regarding Paid Personal Leave Law

As we previously reported, Nevada has enacted a personal leave law, which, effective January 1, 2020, will require private employers with 50 or more employees in Nevada to provide certain employees working in the state with up to 40 hours of paid leave per year, to be used for any purpose, including non-medical personal reasons. To that end, the Nevada Labor Commissioner issued two advisory opinions regarding the new law.

While the law applies to employers with 50 or more employees in Nevada, it is silent on how the 50 employee-threshold should be calculated. In its guidance, the Labor Commissioner addressed this by applying standards from the FMLA; specifically, a covered employer is one that employs 50 or more employees in 20 or more consecutive or nonconsecutive workweeks in the current preceding calendar year. Part-time employees and employees of a joint employer or successor in interest count as part of the 50-employee threshold. However, temporary, seasonal, and on-call employees do not count and are exempt from coverage.

The law does not further define temporary, seasonal, or on-call employees but in its guidance, the Labor Commissioner has clarified that a temporary employee is defined as one who works less than 90 days on a temporary or occasional basis; a seasonal employee is defined as one who works less than 90 days for a specific season; and an on-call or per-diem employee is one who is called to work on an hourly or daily basis based on the employer’s need. Importantly, the Labor Commissioner concluded that any work assignment exceeding 90 days may trigger a presumption of coverage, and recommends employers track hours worked by short-term and on-call employees.

Under the law, employees must give notice of their intent to use leave “as soon as practicable.” Looking to the FMLA rules as a model, the Labor Commissioner explained that while employers should not require advance notice for unforeseeable absences (e.g., emergencies, unexpected illnesses and injuries), 30 days “would be optimal notice for events where the employee knows they need to take paid leave.” Employers should establish a notice requirement in writing that is provided to and signed for by the employee.

Notably, an employer is exempt from coverage if it already provides an equivalent amount of paid leave (whether pursuant to a collective bargaining agreement or other contract, agreement, or policy) to all employees who would otherwise be covered by the law. In other words, such employees would have to accrue at least 0.01923 hours (or approximately 1.15 minutes) of paid leave for every hour worked, up to 40 hours per year. The Labor Commissioner determined that based on the plain and unambiguous language of the so-called existing policies exemption, “employers already providing leave that matches or exceeds” the minimally required leave amount are “explicitly exempt from the other requirements” of the law. However, the Labor Commissioner recommends that employers adopt qualifying policies before the law’s effective date. In a separate opinion, the Labor Commissioner opined that this exemption applies to a collective bargaining agreement under which paid leave benefits are a non-delineated component of a covered employee’s base wage, the value of which equals or exceeds the minimally required leave amount.

With less than two months until the law’s effective date, employers in Nevada should review and, where necessary, revise their existing policies to ensure compliance with these new requirements.

New York State Enacts Law to Protect Employees’ Reproductive Health Decisions

New York Governor Andrew Cuomo has signed into law a bill which, effective immediately, prohibits employers from accessing information on employees’ or dependents’ reproductive health without prior consent.

Specifically, the new law prohibits an employer from “accessing an employee’s personal information regarding the employee’s or the employee’s dependent’s reproductive health decision making, including but not limited to, the decision to use or access a particular drug, device or medical service without the employee’s prior informed affirmative written consent.”  Employers are also prohibited from requiring an employee to sign a waiver or other document which purports to deny an employee the right to make their own reproductive health care decisions, including use of a particular drug, device or medical service. The bill also generally prohibits discrimination and retaliatory action against an employee with respect to “compensation, terms, conditions or privileges of employment because of or on the basis of the employee’s or dependent’s reproductive health decision making, including but not limited to, a decision to use or access a particular drug, device or medical service.”

Employees may bring a civil action against an employer for violation of the law and recover back pay, benefits, reasonable attorneys’ fees and costs.  Other available remedies include injunctive relief, reinstatement and liquidated damages equal to 100% of the award for damages, unless the employer proves a good faith basis to believe that its actions in violation of the law were in compliance with the law.

Moreover, an employer that engages in retaliation is subject to separate civil penalties.  For purposes of this provision, retaliation is defined as discharging, suspending, demoting or otherwise penalizing an employee for:

  • Making or threatening to make, a complaint to an employer, co-worker, or to a public body, that rights guaranteed under the law have been violated;
  • Initiating any proceeding under or related to the law; or
  • Providing information to, or testifying before, any public body conducting an investigation, hearing, or inquiry into any such violation of the law.

Notably, employers that maintain an employee handbook must include in the handbook a notice of employee rights and remedies under this law.  Employers in New York should therefore review and revise their existing handbooks to ensure compliance with these new requirements.

Emerging Trend: ADA Does Not Cover Potential Future Disabilities

Heeding the adage “no one knows what the future may hold,” the Seventh, Eighth and Eleventh Circuits have uniformly refused to extend protections of the Americans with Disabilities Act (ADA) to employees with a perceived risk of a potential impairment.

In each case, an employer either declined to hire an applicant or terminated an employee based on the perceived possibility that the individual – who otherwise did not have an actual disability – would later develop a medical condition that could impair their capacity to perform essential job functions or otherwise pose a safety concern. In a September 2019 case before the Seventh Circuit and in an April 2016 case out of the Eighth Circuit, both involving the same employer, a transportation company declined to hire a job applicant with a BMI of over 40 (therefore classified as obese) for a safety sensitive position because of the perceived risk that the applicant could develop certain medical conditions in the future that could cause sudden incapacitation while working, such as sleep apnea or heart disease (it is noted that, in both circuits, the courts held that obesity alone is not a protected disability under the ADA). And in September 2019, the Eleventh Circuit addressed a case where an employer terminated a massage therapist who requested time off to travel to Ghana to visit family because of the perceived risk that the employee would contract the Ebola virus, due to recent outbreaks of the disease in neighboring countries.

In all of the cases, the plaintiffs argued that because the ADA includes in its definition of “disability” situations where an individual is “regarded as” having an impairment that substantially limits one or more major life activities, ADA protections should apply because the employers were regarding the individual as having a risk of developing such an impairment. The courts were therefore confronted with the question: does an employer relying upon a potential future disability as the basis for an adverse employment action violate the “regarded as” protections under the ADA?

In a rare display of unity regarding interpretations of the ADA, all three circuits concluded that an employee may only pursue a claim under the “regarded as” anti-retaliation provision if the adverse action in question occurred as a result of the employer’s perception of a current, actual disability. Based on the ADA’s statutory language defining “disability” as including situations where individuals are “being regarded as having a physical or mental impairment,” the courts found that the statute is intended to encompass only current impairments, not future ones. The courts also noted that the appendix to the ADA’s governing regulations (as promulgated by the EEOC) states that an “impairment” under the law does not include “predisposition to illness or disease.” As such, the courts concluded that an employer cannot discriminate against an applicant or employee based on a perception of potential disability. As the Eleventh Circuit summarized, “the disability definition in the ADA does not cover [a] case where an employer perceives a person to be presently healthy with only a potential to become ill and disabled in the future.”

Despite the unanimity of these Circuit Court decisions and its own regulations to the contrary, the EEOC has argued in at least one amicus submission that a potential future condition does satisfy the ADA’s “regarded as” definition of “disability” as long as the condition in question otherwise qualifies as a protected disability under the statute. In attempting to limit the scope of its own ADA regulations, the EEOC argued that its regulation that an employee’s “characteristic predisposition to illness or disease” is not a covered impairment applies only to “regarded as” disabilities based on physical, psychological, environmental, or other characteristics that are not otherwise impairments under the ADA. For instance, under the EEOC’s interpretation of this regulation, an individual’s predisposition to developing a disease because of poverty or other socio-economic circumstances would not be protected by the ADA, whereas predisposition to a disease because of a health condition – such as obesity – would be entitled to ADA protections. Thus, notwithstanding the trend at the Circuit Court level regarding speculative future disabilities, the agency may pursue enforcement actions based on its own interpretation of its regulations.

As always, we will continue to monitor developments in this area.

Connecticut Commission on Human Rights and Opportunities Issues Guidance on Sexual Harassment Training and Notice Requirements

As we previously reported, Connecticut has enacted the Time’s Up Act (the “Act”), which expanded existing sexual harassment training and notice requirements on employers. Under the new law, employers with three or more employees must provide two hours of interactive sexual harassment training to all existing employees by October 1, 2020, and to all new employees no later than six months after hire. Employers with fewer than three employees are required to provide such training only to supervisory employees by October 1, 2020; any new supervisory employees must be trained within six months of assuming supervisory duties. In addition, employers must also post a notice regarding “the illegality of sexual harassment and remedies available to victims of harassment” in a prominent and accessible place, and provide employees with a copy of this information by email within three months of hire.

To that end, the Connecticut Commission on Human Rights and Opportunities (“CHRO”) has now published (in both English and Spanish) FAQs, a “Sexual Harassment is Illegal” poster and other written materials regarding sexual harassment. The CHRO has also made available on its website a free online training and education video, which may be used by employers to satisfy their obligations under the law.

Importantly, the FAQs make clear that the Act applies to any employer with at least one employee based in Connecticut, even if the employer is based out of state (provided it also employs at least three employees). For example, the FAQs state that if a Minnesota-based company has ten employees in Minnesota and one employee in Connecticut, that one employee in Connecticut is subject to the training requirements.

Covered employers are required to either utilize the CHRO’s model training materials or establish their own training program that equals or exceeds the minimum standards set forth under the law, including the requirement that the training be interactive. According to the FAQs, training can be done via a recorded video or online (i.e., it need not be live); however, it must be in a format that allows participants to ask questions and receive answers.

The CHRO’s online training and education video is broken up into six segments and incorporates several interactive quizzes. Employees will receive a certificate of completion within 24 hours of finishing the training, and while such certificates are not required to prove an employee has completed the training, employers may want to maintain them to internally track compliance with the law. Notably, the video is designed for all employees and does not contain a separate section for supervisors. Moreover, it directs complainants to report concerns to a supervisor or seek assistance from the CHRO directly, and does not provide a mechanism for employers to incorporate their own reporting and investigative process. The video also addresses public accommodations and housing discrimination, such that it may not be appropriate for all employers.

We will continue to report on any further developments with regard to this law.

Westchester County, New York Issues Guidance and Mandatory Notices for Safe Time Leave Law

As we previously reported, effective October 30, 2019, Westchester County, NY employers are required to provide paid leave to employees who are victims of domestic violence or human trafficking (“safe time”). Leave under the new ordinance will be in addition to paid time off already required to be provided to employees under the Westchester County paid sick leave law, which took effect on April 10, 2019.

In connection with the effective date of the safe time leave law, the Westchester County Human Rights Commission has released new FAQs as well as a Notice of Employee Rights and mandatory poster. While the Commission’s FAQs generally restate the law’s requirements, they do clarify the rate of pay employees must receive when taking leave. Specifically, employers must pay employees the hourly rate they would have otherwise earned had they reported to work. However, the FAQs do not address pay calculations for employees not paid on an hourly basis (e.g., piece-rate workers or employees who only earn commission).

Employers are required to provide both a copy of the safe leave ordinance and the Notice of Employee Rights to eligible employees on the first day of employment or within 90 days of the law’s effective date (i.e., by no later than January 28, 2020), whichever is later. Employers must also display a copy of the ordinance and the mandatory poster in both English and Spanish in a conspicuous location accessible to employees. Failure to comply with the notice and posting requirements can result in fines of up to $500 for each offense.

Employers in Westchester County, New York should review their existing policies and postings to ensure compliance with these requirements.