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Archive for the ‘Employment Law Blog – NC’ Category

NLRB’s General Counsel Says Nonunion Workers Should Have Representation Rights During Investigative Interviews

Posted on: September 13th, 2017

By: Paul H. Derrick

The National Labor Relations Board is at it again. A recently-released memorandum from the Board’s Division of Advice reveals that the Office of the General Counsel directed one of the NLRB’s regional offices to issue two complaints against an employer for refusing to allow nonunion workers to have a representative of their choosing accompany them to investigative interviews. The memorandum explains that the complaints should then be litigated in hopes of getting the five-member NLRB to reverse current law and extend so-called Weingarten rights to nonunion workplaces.

Weingarten rights stem from a 1975 U.S. Supreme Court case in which the justices ruled that unionized workers have a right to request a union representative’s presence at any investigative interview that reasonably could result in disciplinary action. The NLRB has flip-flopped over the years, depending on which political party was in power, about whether Weingarten rights apply in a nonunion workplace. In 2000, it ruled that nonunion workers had a right to representation during investigative interviews. In 2004, it reversed course, noting that nonunion co-workers, friends, and third-parties had no place in the process because they do not represent the collective interests of the workforce and they lack the advisory and negotiating skills of trained union stewards.

The recent General Counsel memorandum says that the NLRB simply got it wrong in 2004 because it failed to take into account the importance of employee solidarity as a fundamental labor law principle. “When one employee supports another…including being present in the investigatory interview of a coworker that might result in discipline, there is an implicit promise of future reciprocation and it does not matter whether those acting in solidarity represent any other employee’s interests. … It is enough that one employee has made common cause with another.” The memorandum went on to say that a nonunion employee who requests Weingarten representation should be entitled to the representative of his choice, as long as that choice does not cause undue delay in the investigation.

Whether the NLRB will actually address nonunion Weingarten rights anytime soon is far from certain. Earlier this year, it unanimously denied a petition requesting that it use its rulemaking power to simply mandate that all nonunion employees be afforded Weingarten rights. Also, the two cases addressed in the General Counsel’s memorandum could be resolved through a settlement, in which case the NLRB itself would not be presented with the issue.

We will continue to keep you apprised of developments in this area as they occur. In the meantime, if you have any questions or would like more information, please contact Paul Derrick at [email protected].

EEOC to Employers (Again): The FMLA Does Not Trump the ADA

Posted on: September 7th, 2017

By: Paul H. Derrick

The Equal Employment Opportunity Commission has sued an employer in Hawaii over its refusal to provide additional leave time as an accommodation for disabled employees who were unable to return to work without limitations after exhausting all of their FMLA leave. The lawsuit is certainly not the first of its kind, and it underscores an issue that too many employers seem to either ignore or misunderstand.

According to the EEOC, the employer in this latest case maintained a rigid leave policy under which employees with disabilities were not granted any additional leave of absence as a reasonable accommodation beyond the required 12 weeks under the Family and Medical Leave Act. Instead, they were required to return to work without limitations at the end of that leave. Those who could not were terminated. The lawsuit seeks back pay and benefits, along with compensatory and punitive damages for one named employee and a class of aggrieved individuals, as well as injunctive relief intended to prevent any future discrimination in the workplace.

The EEOC and many courts have long taken the position that inflexible leave policies violate the Americans with Disabilities Act because the ADA requires employees to engage in an interactive process with disabled employees who ask for reasonable accommodations that are likely to enable them to return to work. Sometimes, an additional period of leave, although not an indefinite one, can be a reasonable accommodation, and employers who refuse to consider that option do so at their own peril. Maintaining a rigid leave policy such as the one alleged in this new lawsuit can be seen as unlawful disability discrimination because the employee may be denied a reasonable accommodation that would enable them to return to work.

Employers have different obligations under the FMLA and ADA, and meeting the FMLA obligations by providing 12 weeks of protected leave does not meet the ADA’s requirement that an employer consider reasonable accommodations, when requested. Again, an additional, limited period of leave may be a reasonable accommodation, depending on the circumstances.

Employers also should be aware that this issue is not likely to go away any time soon. Addressing disability discrimination in the form of inflexible leave policies is one of six national priorities identified by the EEOC’s Strategic Enforcement Plan, so we can expect more cases like this one in the future.

If you have any questions or would like more information, please contact Paul Derrick at [email protected].

North Carolina Enacts Worker Misclassification Law

Posted on: September 5th, 2017

By: Paul H. Derrick

North Carolina’s new Employee Fair Classification Law creates a division within the state’s Industrial Commission to investigate and prosecute worker misclassification complaints. The law came about after a series of newspaper reports detailing the widespread practice of employers classifying a large portion of their workers as independent contractors instead of employees in order to avoid unemployment taxes and payments, workers’ compensation, payroll taxes, and other wage costs.

The newly-created division will report complaints to various state agencies involved with misclassifications, including Department of Revenue, Department of Labor, Division of Unemployment, and others. That means a single worker complaint could trigger a far-reaching investigation of an employer’s labor practices by a number of administrative authorities.

Many businesses believe that simply labeling a worker as a “contractor” is enough to take them outside the coverage of state and federal employment laws. That is simply wrong. Workers are legally presumed to be employees unless their work arrangements meet several rigorous criteria. The standard for determining employee or independent contractor status is based on the common law “right of control test,” which considers such things as whether the worker: is engaged in an independent business; has independent use of his special skills, knowledge, or training; was hired only to do a specified piece of work; is not subject to being discharged for his method of work; and is free to hire assistants and fully control their work.

North Carolina companies that use contract labor should take the time to carefully review the basis for their classifications and ensure that anyone classified as a contractor truly meets the applicable criteria. Those that fail to ensure compliance can expect significant investigative costs, legal expenses, and general disruption that often accompanies misclassification claims.

If you have any questions or would like more information, please contact Paul Derrick at [email protected].

With DOL’s Overtime Rule Still in Limbo, What Should Employers Do Now?

Posted on: August 31st, 2017

By: Paul H. Derrick

As most employers know, the U.S. Department of Labor announced, during the Obama administration, that it was rolling out new standards for determining when employees are entitled to be paid overtime for all time worked beyond 40 hours in a work week. The so-called “overtime rule” or “white collar” exemptions would have required employers to pay certain executive, professional, and administrative employees a salary of at least $913 each week in order to make them exempt from the overtime requirement.

But in late 2016, a federal judge in Texas enjoined DOL from implementing the new rule anywhere in the country, finding that the DOL lacks the authority to set any salary test at all. Meanwhile, the underlying case continued to progress between the parties to the lawsuit. DOL appealed the ruling to the Fifth Circuit Court of Appeals, but it asked only that the court overturn the judge’s finding that the agency lacks the authority to set a salary test. It did not ask the appeals court to stay the overall case.

Then, in July of this year, the “new” DOL, headed by a Trump appointee, announced that it was seeking public input on ways to revise the Obama administration’s overtime rule. That process remains ongoing, with any possible modification of the rule unlikely until at least late 2018. In the meantime, the Fifth Circuit is scheduled to take up DOL’s appeal during oral arguments on October 3, and a decision could come within just a few months.

Wondering what that decision might be is causing employers a good bit of anxiety these days. On the one hand, the Fifth Circuit could affirm the injunction and maintain the status quo, which would give DOL time to come up with a new rule, but one that might not necessarily be allowed to use some variation of the traditional salary test. On the other hand, the court could decide that DOL does have the authority to establish a salary test and modify or dissolve the injunction, thus paving the way for the Obama-era rule to take effect long before a replacement rule is finalized by the Trump DOL.

That latter scenario, in turn, could put both DOL and employers in a bind. DOL would have to figure out whether and how to implement and enforce a rule it already has announced it plans to change. Employers would have to assess the risk of complying or not complying with a rule that almost certainly will change within the short term. If they were to comply, any new rule that were to come along later could have a significant financial and operational impact on them. If they did not comply, even if DOL decided not to enforce the Obama rule, they could still face legal liability from employees who sued because they were not being paid under the standard set by the Obama rule.

Confusing, isn’t it?

While there are no easy answers for employers, there are a few things to keep in mind to minimize any downside risk:

• In all cases, cap employees’ hours to avoid the possibility of overtime violations during any period when the Obama rule is in place and the Trump DOL is coming up with a new rule.

• For employers who had already made and carried out changes in anticipation of the Obama-era rule going into effect, stick with those changes and wait to see what happens next. There is little to be gained by reversing those changes right now, and any potential gain could be outweighed by disruptions in the workplace and in employee morale.

• For employers who were ready to carry out changes in order to comply with the Obama rule but had not yet put them into effect at the time the rule was enjoined, keep the changes on hold until there is greater certainty about whether, and when, the new regulations will ever become effective.

• For employers who had not yet done anything, simply keep waiting and seeing what the future brings.

We will continue to keep you apprised of developments in this area as they occur. In the meantime, if you have any questions or would like more information, please contact Paul Derrick at [email protected].

Employers Don’t Have to Report Pay Data on EEO-1 Form

Posted on: August 30th, 2017

By: Paul H. Derrick

As we previously reported, the U.S. House Appropriations Committee put the future of the Equal Employment Opportunity Commission’s revised Form EEO-1 in doubt by inserting a rider into the annual budget proposal that would prohibit the EEOC from spending any funds on its plan to collect pay data from employers on the new form. The Office of Management and Budget now has taken things a step further.

Yesterday, OMB informed the EEOC that all efforts to implement the pay data reporting requirements must immediately cease. The revised EEO-1 would have required all businesses with 100 or more workers to submit pay data by gender, race, and ethnicity on their forms. OMB’s directive to the EEOC to stand down, however, is based on its concern that “some aspects of the revised collection of information lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues.”

The traditional portions of the EEO-1 form that collect data on race, ethnicity, and gender by occupational category will remain in effect. Employers should plan to comply with the reporting requirements by the filing date of March 2018. Instructions are at:
If you have any questions or would like more information, please contact Paul Derrick at [email protected].