Workforce Bulletin

When the pandemic abruptly shifted many employment relationships from offices and other physical workplaces to remote environments, many governmental and regulatory authorities responded by modifying existing protocols to accommodate new realities. Among those were temporary adaptations to long-standing federal requirements for inspecting identification and verifying employment eligibility, whereby employers were permitted to forego standard document inspection procedures while completing Form I-9.

For decades, many employers have rounded non-exempt employees’ work time when calculating their compensation.  Maybe they have rounded employee work time to the nearest 10 minutes, maybe to the nearest quarter hour, but they done it. And, generally, the courts have approved of the practice.

But as more and more lawsuits are filed challenging the practice, and as the courts begin to review time-rounding more frequently and more critically, the question employers with time-rounding policies should ask themselves today is this:  Why are we still rounding our employees’ time?

The California Court of Appeal for the First Appellate District recently issued its opinion regarding business-related expenses in Thai v. International Business Machines Corporation. The Court found that expenses incurred by employees in direct consequence of performing their jobs may be reimbursable regardless of whether such expenses are directly caused by the employer.

Paul Thai was employed by defendant and respondent IBM. Thai required, among other things, internet access, telephone service, a telephone headset, a computer and accessories in order to perform the functions of his job. On March 19, 2020, Governor Newsom issued a stay-at-home order that instructed all California residents “[t]o stay home or at their place of residence except as needed to maintain continuity of operations of the federal critical infrastructure sectors” and any other additional sectors later designated as critical. After the order went into effect, IBM directed Thai and thousands of other workers to continue performing their regular job duties from home. Thai and the other IBM workers personally paid for the services and equipment necessary to do their jobs while working from home, and IBM did not reimburse them for those expenses.

As we previously reported, on May 8, 2023, the New Jersey Department of Labor and Workforce Development (“NJDOL”) published a web page providing guidance in the form of Frequently Asked Questions (the “FAQs”) to assist employers in complying  with the provisions of the Temporary Workers’ Bill of Rights (the “Law”). Recently the NJDOL released proposed regulations to implement the Law (the “Proposed Regulations”) that elaborate on many of the Law’s provisions, including its pay equity requirement.  Public comment on the Proposed Regulations will be accepted until October 20, 2023.

In addition to the Proposed Regulations, the NJDOL has also updated its FAQs.

With amendments to the Colorado Equal Pay for Equal Work Act (the “Act”) set to take effect on January 1, 2024 (the “2024 Amendments”), the Colorado Department of Labor and Employment (“CDLE”) has started the process of updating its compliance guidance for employers. The first update comes in the form of a revised Interpretative Notice & Formal Opinion ("INFO") #9, which the CDLE published on July 28, 2023.

On August 2, 2023, the National Labor Relations Board (“NLRB” or “Board”) announced a long-anticipated decision called Stericyle that will affect how employers craft, apply and enforce workplace policies, regardless of whether a labor union represents their employees. As we anticipated several years ago, the Stericyle Board, with a majority of members nominated by President Joseph Biden, rejected the agency’s 2017 decision in The Boeing Company, in which it adopted a balancing test to evaluate facially neutral employer rules and handbook provisions. Under The Boeing Company test, the Board weighed the nature and extent of such rules’ potential impact on employee rights under the National Labor Relations Act (“NLRA”) against employers’ legitimate justification(s) for the policies.

The majority opinion in Stericycle Inc. substantively revives the NLRB’s stance on workplace rules as established in the 2004 Lutheran Heritage decision. Under this new framework, the mere maintenance of any employer’s rule, policy, or handbook provision that has a “reasonable tendency to chill employees from exercising their Section 7 rights” may constitute an unfair labor practice in violation of the NLRA.

On July 21, 2023, a unanimous three-judge panel once again affirmed a California federal court’s ruling that the truck drivers who deliver ingredients from Domino’s Southern California Supply Chain Center to Domino’s California franchisees are exempt from the Federal Arbitration Act (“FAA”).

On August 2, 2023, the National Labor Relations Board (“NLRB” or “Board”) announced a long-anticipated Decision that will affect how employers craft, apply and enforce workplace policies in almost all workplaces, regardless of whether employees are represented by a union. As we anticipated several years ago, the current Board, with a majority of members nominated by President Biden, has now rejected the agency’s 2017 decision in The Boeing Company, in which it adopted a balancing test to evaluate facially neutral employer rules and handbook provisions by examining the nature and extent of their potential impact on employee rights under the National Labor Relations Act (“NLRA” or the “Act”) against legitimate justification(s) for the policies.

The majority opinion in Stericycle Inc. substantively revives the NLRB’s stance on workplace rules as established in the 2004 Lutheran Heritage decision.Under this new framework, any employer’s rule, policy, or handbook provision that  has a “reasonable tendency to chill employees from exercising their Section 7 rights” may be deemed to constitute an unfair labor practice and to be unlawful in violation of the NLRA.

Employers with operations both large and small in California are all too familiar with California’s Private Attorneys General Act (“PAGA”), the controversial 2004 statute that permits a single employee to stand in the shoes of the state’s attorney general and file suit on behalf of other employees to seek to recover penalties for alleged Labor Code violations.

PAGA lawsuits are filed with great regularity by members of the plaintiffs’ bar.

And the in terrorem effect of PAGA lawsuits, in which a plaintiff need not satisfy class certification criteria to represent an entire workforce, has led many employers to pay large settlements just to avoid legal fees and the possibility of larger awards -- even when the evidence of unlawful conduct is spotty or entirely absent.

On July 20, 2023, U.S. Senators Bob Casey (D-PA) and Brian Schatz (D-HI) introduced the “No Robot Bosses Act.”  Other than bringing to mind a catchy title for a dystopic science fiction novel, the bill aims to regulate the use of “automated decision systems” throughout the employment life cycle and, as such, appears broader in scope than the New York City’s Local Law 144 of 2021, about which we have previously written, and which New York City recently began enforcing. Although the text of the proposed federal legislation has not yet been widely circulated, a two-page fact sheet released by the sponsoring Senators outlines the bill’s pertinent provisions regarding an employer’s use of automated decision systems affecting employees and would: