Allergic to Work?

By Ann Holden Kendell

According to the Mayo Clinic, allergies occur when your immune system reacts to a foreign substance or to a food that does not cause a reaction in most people. “Allergy symptoms depend on the substance involved and can affect the airways, sinuses and nasal passages, skin, and digestive system. Allergic reactions can range from mild to severe. In some severe cases, allergies can trigger a life-threatening reaction known as anaphylaxis.” http://www.mayoclinic.org/

Generally, when it comes to workplace health issues, we think of the Occupational Health and Safety Administration (OSHA). OSHA regulates toxic substances and air contaminants in the workplace, but does not specifically focus on allergens.  Often, these regulatory limits are not low enough to prevent allergic reactions. So, if OSHA doesn’t cover it – does an employer need to bother with this?  Simply put, yes.

Under the Americans with Disabilities Act (ADA), a person with a disability is someone with a physical or mental impairment (or a record of such impairment) that substantially limits a major life activity.  Major life activities (MLA) include caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, sitting, reaching, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, interacting with others, and working. MLA’s also include the operation of a major bodily function – like the immune system, special sense organs and skin, normal cell growth, digestive, genitourinary, bowel, bladder, neurological, brain, respiratory, circulatory, cardiovascular, endocrine, hemic, lymphatic, musculoskeletal, and reproductive functions.  Allergies can bring employees within the protection of the ADA.

Therefore, if an employee is having an allergic reaction to something in the workplace, employers have to employ the traditional ADA analysis as to whether a reasonable accommodation can be provided to the employee. First – try to find the allergen in the workplace and remove it. Increased ventilation and/or improved equipment design can be used to lessen or eradicate the exposure (reduce vapors, splashes, etc.) If the allergen cannot be removed or depleted enough, employers can accommodate the allergic employee with individual protections – such as protective clothing, barrier creams for the skin and respirators. But, OSHA regulations should not be forgotten.  For example, if an employee needs a respirator, the employer must still comply with OSHA’s Respiratory Protection Standard to determine whether an employee could wear a respirator.

If the accommodation needed by an allergic employee would create an undue hardship on the employer, it is not required under the ADA.  Undue hardship can be difficult to prove and should be carefully considered by employers along with legal counsel.

Fiduciary Rule Update: Department of Labor Issues Proposed Extension of Fiduciary Rule Applicability Date

By Cynthia Boyle Lande

On March 1, the Department of Labor issued a Proposed Rule extending the effective date of the Fiduciary Rule from April 10, 2017 to June 9, 2017. The Department’s issuance of the Proposed Rule is in response to the Presidential Memorandum issued February 3, 2017, directing the Department to further examine the Fiduciary Rule to determine how it has impacted or will impact individuals and the retirement services industry. The Proposed Rule also seeks comments on the issues identified in the February 3 Presidential Memorandum, including how the Fiduciary Rule protects investors; how the Fiduciary Rule harms retirements services professionals; whether the Fiduciary Rule will limit investors’ access to quality retirement services and investment products; and whether alternatives to the Fiduciary Rule exist. The Department will be accepting comments on the Proposed Rule through March 17, 2017. BrownWinick will continue to monitor changes in this area.

I-9 Update: Updated Handbook for Employers Released

By Beth Coonan

On January 22, 2017, the U.S. Citizenship and Immigration Services (“USCIS”) published an updated “Handbook for Employers: Guidance for Completing Form I-9.” This updated version (M-274) includes numerous policy and regulatory changes.  The revised Handbook provides detailed guidance for completing the revised Form I-9, Employment Eligibility Verification.  A link to the new Handbook as well as a table describing the changes can be found by clicking on the links below.

Handbook for Employers: Guidance for Completing Form I-9

Table of Changes for Revised M-274

SECTION 7 V. TITLE VII = HEAVYWEIGHT MATCH

By Ann Kendell

In Cooper Tire & Rubber Company v. NLRB (Case 08–CA–087155), a bargaining unit employee yelled racist statements to African-American replacement workers while he was on a picket line. These comments included: “Hey, did you bring enough KFC for everyone?” and “Hey, anybody smell that? I smell fried chicken and watermelon.”

The employee was fired for making these statements and he filed a grievance. The union filed an unfair labor practice charge against the employer alleging that the employee was discharged for exercising his Section 7 rights under the National Labor Relations Act (NLRA). The matter was submitted to an arbitrator who found that the employee made both statements, that the comments violated the employer’s harassment policy and denied the grievance – determining that the employee was terminated for “just cause.” The matter went before an administrative law judge (ALJ) who found that the arbitrator’s decision went against the NLRA. The ALJ decision was appealed to the National Labor Relations Board (NLRB). The NLRB agreed with the ALJ and found that the discharge for the racist comments was in violation of the NLRA and ordered the employer to reinstate the employee with full back pay. The case is currently pending in the U.S. Court of Appeals for the Eighth Circuit.

SECTION 7 of the NLRA provides employees "the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection."[1] While the NLRB noted in its decision that the “statements most certainly were racist, offensive, and reprehensible,” they were still protected by the NLRA. NLRB Decision   

TITLE VII of the Civil Rights Act of 1964 (Title VII) protects employees by:

• making it illegal to discriminate against on the basis of race, color, religion, national origin, or sex;
• making it illegal to retaliate against a person because the person complained about discrimination, filed a charge of discrimination, or participated in an employment discrimination investigation or lawsuit; and
• requiring employers to reasonably accommodate applicants' and employees' sincerely held religious practices, unless doing so would impose an undue hardship on the operation of the employer's business.

Title VII is enforced by the U.S. Equal Employment Opportunity Commission (EEOC), as well as through claims brought in court by private litigants. Employers violate Title VII by requiring employees to work in a racially hostile environment[2] - even if the behavior occurred on a picket line.[3] 

This is not the first time that Section 7 and Title VII have been in conflict. Within the past two years, the NLRB issued decisions establishing that employers are limited on the confidentiality of witness statements in harassment investigations (a general interest in maintaining the confidentiality of company investigations or avoiding harassment and intimidation of employees was not sufficient to support a refusal to provide the information) and that an employer’s policy requiring confidentiality in investigations will violate Section 7.[4] However, under Title VII, the EEOC has issued instruction on preventive action for harassment, stating that employers should “have a procedure for resolving ... harassment complaints,” which is “designed to ‘encourage victims of harassment to come forward’" and should “ensure confidentiality as much as possible.” EEOC Guidance

WHAT TO WATCH:  If one were to wager on this match, Title VII is the contender. The Eighth Circuit is the same court that found behavior on a picket line may constitute a racially hostile work environment under Title VII.

Update: DOL Responds to Presidential Memorandum

By Cynthia B. Lande

On Thursday, February 9, the Department of Labor filed a notice with the Office of Management and Budget seeking to delay the applicability date of the Fiduciary Rule. It is anticipated that the DOL will seek a 180-day delay in the applicability of the rule, during which it will complete the review ordered under the February 3 Presidential Memorandum. 

Trump Issues Presidential Memorandum on Fiduciary Rule

By Cynthia B. Lande

On Friday, February 3, 2017, President Trump issued a Presidential Memorandum directing the Department of Labor to further examine the Fiduciary Rule and how it impacts business and investors. The Department of Labor responded to the Memorandum, stating that it will explore legal options to delay the applicability date of the Fiduciary Rule while it completes the examination required under the Memorandum.

The original applicability date under the Fiduciary Rule was scheduled to be April 10, 2017. It is not clear at this time whether the Presidential Memorandum will result in a delay in this applicability date or other changes to the Fiduciary Rule. BrownWinick will continue to monitor the DOL’s examination of the Fiduciary Rule. If you have any questions about the Fiduciary Rule, or changes to the Fiduciary Rule as a result of the Presidential Memorandum, you should contact your BrownWinick employee benefits attorney.

New I-9 Form: Change is Here

By Elizabeth A. Coonan

United States Citizenship and Immigration Services ("USCIS") announced that all employers must use the Form I-9 bearing date 11/14/2016 N beginning January 22, 2016.  Use of prior versions is no longer acceptable and may subject an employer to fines and penalties. Existing storage and retention rules remain in place and should be followed. The new form contains significant changes in terms of processing and should be reviewed carefully. Please do not hesitate to contact us if you have any questions. 

Overtime Litigation Update

By Elizabeth A. Coonan

Many employers jumped for joy when the United States District Court for the Eastern District of Texas issued an injunction halting the implementation of the overtime rule in late 2016. On Tuesday, January 3, 2017, the United States District Court for the Eastern District of Texas issued a ruling denying the U.S. Department of Labor’s request to stay the district court proceedings in the overtime litigation while the DOL’s appeal of the preliminary injunction to the 5^th Circuit is heard. The decision denying a stay of the underlying district court matter essentially places employers in the same position as they existed following the issuance of the preliminary injunction.

In an interesting move, the Texas AFL-CIO moved to intervene in the district court lawsuit as an additional party, presumably to permit the lawsuit to continue in the event the new administration withdraws its appeal.  Briefing at the 5^th Circuit is scheduled to conclude on January 31, 2017, after President Elect Trump’s inauguration. BrownWinick will continue to keep you informed as to new developments. 

Federal Overtime Rule Blocked!

By Elizabeth A. Coonan and Ann Holden Kendell

Late yesterday, a federal court in Texas issued a nationwide injunction blocking the Department of Labor’s new overtime rule. This rule aimed to raise the Fair Labor Standards Act’s (FLSA’s) salary threshold for the white collar exemptions from overtime pay from $23,660 to $47,476 per year. 

This means that if you were contemplating re-classifying your employees due to a salary shortfall, you don't need to do that....yet.  We expect that the matter will be appealed but in the meantime, employers should follow the existing rule. 

Click here for a copy of the court’s Order.

Click here for a summary description of the existing rule.

Should you have any questions about the Order or its impact on your business, please contact Elizabeth A. Coonan, Ann Holden Kendell or the Brown Winick attorney with whom you work.

IRS Extends Due Date for 2016 ACA Employer Forms

By Cynthia Boyle Lande

On November 18, 2016, the IRS issued Notice 2016-70, which extends the due date for certain forms required to be provided to employees of applicable large employers (or ALEs) under the Affordable Care Act. Under Notice 2016-70, the deadline for distributing the Form 1095-C to full-time employees was extended from January 31, 2017 to March 2, 2017. Notably, the deadline for filing the Form 1094-C and 1095-Cs with the IRS was not extended. The IRS filings must still be completed by February 28, 2017 if filed by paper, or March 31, 2017 if filed electronically.

Notice 2016-70 also extends two other pieces of transition relief that applied during the 2015 filing season. First, individuals who do not receive a Form 1095-C in time to file their individual return may rely on other information received from their employer for purposes of reporting health insurance offered by their employer. Additionally, Notice 2016-70 extends the good-faith transition relief afforded to 2015 filings under the final ACA regulations. Employers who can show that they have made a good-faith attempt to comply with the ACA information reporting requirements will not owe a penalty for incorrect or incomplete information reported on their return or statement. This good-faith relief does not apply to employers who fail to file or furnish a statement by the applicable due date.

If you have any questions about your reporting or other obligations under the Affordable Care Act, you should contact your BrownWinickemployee benefits attorney.

USCIS Publishes Revised Version of Form I-9, Employment Eligibility Verification

By Elizabeth A. Coonan

USCIS has published a revised version of Form I-9, Employment Eligibility Verification. Beginning 1/22/17, employers must use the new version. The new form bears the date 11/14/16.  Employers may continue to use the prior version until 1/21/2017 (dated 3/8/2013) or may adopt the new version immediately.

Changes to the fillable form include drop-down lists, on-screen instructions for each field (similar to other USCIS forms) and when the employer prints the completed form, a QR code is automatically generated. Substantively, the changes are subtle. For example, the new form asks for “other last names used” rather than “other names used,” includes space to enter multiple preparers and translators and includes prompts to ensure information is entered correctly.

If you have questions about the new form, please contact me or the BrownWinick Employment Attorney with whom you work.

I-9 Form Update

By Elizabeth A. Coonan

USCIS has indicated that employers may continue to use the Form I-9 dated March 8, 2013, through January 21, 2017. After January 22, 2017, employers must use the revised form. Please contact Elizabeth Coonan at coonan@brownwinick.com or 515-242-2408.

AARP Sues EEOC Over Final Wellness Program Rules

By Cynthia Boyle Lande

On October 24, 2016, AARP sued the EEOC regarding the final wellness program regulations issued by the EEOC earlier this year. While the final wellness program regulations have received criticism, this is the first major lawsuit filed against them. AARP claims that the final regulations violate laws aimed at protecting the privacy of employee medical information. AARP is seeking a preliminary injunction to stop implementation of the final wellness program regulations, which are set to take effect in 2017.

Under federal law, employers generally cannot require their employees to share medical information. Motivated in part by new HIPAA rules under the Affordable Care Act, many employers have started offering health assessments and other wellness programs that involve the sharing of employee medical information. The final wellness program regulations allow these types of programs so long as they are voluntary and meet certain other requirements. If the incentive under a wellness program is significant enough, it may be deemed essentially a requirement to share medical information. Under the final wellness program regulations issued by the EEOC, if the incentives under a voluntary wellness program do not exceed 30% of the cost of health insurance coverage, the program will not be deemed to require employees to share medical information.

We will continue monitoring this lawsuit and provide updates when they are available. If you have any questions about your wellness program, we would encourage you to contact any member of the BrownWinick employmentpractice group. 

STUDENTS UNITE!

By Ann Holden Kendell

Yesterday, the National Labor Relations Board issued a decision in Columbia University (Case 02–RC–143012), in which it determined that student assistants working at private colleges and universities are statutory employees covered by the National Labor Relations Act.  https://www.nlrb.gov/case/02-RC-143012

The Board has bounced back and forth on this issue since 2000:

• New York University, 332 NLRB 1205 (2000) = first time certain university graduate assistants were held to be employees under the statutory definition and common law principles of the master-servant relationship. 332 NLRB 1205
   
• Brown University, 342 NLRB 483 (2004) = overruled New York University and held that graduate assistants cannot be statutory employees because they “are primarily students and have a primarily educational, not economic, relationship with their university.”  342 NLRB 483

• Columbia University, Case 02–RC–143012 (2016) = overruled Brown University

In overruling Brown University yesterday, the Board stated bluntly, “We revisit the Brown University decision not only because, in our view, the Board erred as to a matter of statutory interpretation, but also because of the nature and consequences of that error.”  The Board noted that statutory coverage is “permitted by virtue of an employment relationship; it is not foreclosed by the existence of some other, additional relationship that the Act does not reach.”  As such, because the student assistants perform work at the direction of the university for which they are compensated, the Board has the authority to treat them as statutory employees under Section 2(3) of the National Labor Relations Act.  Simply put, the fact that these people also have an educational relationship with the university does not negate the employment relationship with the university.

Companies Must Update Policies, Agreements To Receive Benefits Under New Federal Trade Secrets Act

By Bryan Ingram

Trade secrets are common in virtually every industry and range from complex technical designs to simple business processes.[1] Prior to the enactment of the Defend Trade Secrets Act (“DTSA”)[2], if an employee illegally took a valuable design or process to a competitor, the company could only seek recovery under state law.[3] However, on May 11, 2016, The DTSA created a federal private right of action and expanded the benefits for victims of misappropriated trade secrets.

The DTSA automatically creates a federal private right of action if a company’s misappropriated trade secret is “related to a product or service used in, or intended for use in, interstate or foreign commerce.”[4] The remedies available under the DTSA include injunctive relief, damages, and attorney’s fees.[5] The DTSA also includes a three-year statute of limitations.[6] While the DTSA creates a new federal pathway to protect trade secrets, it does not preempt existing state law.[7] Consequently, companies now have more jurisdictional options when pursuing trade-secret litigation.

The DTSA also creates a mechanism to recover stolen trade secrets in “extraordinary circumstances.”[8] According to the DTSA, a court may “issue an order providing for the seizure of property necessary to prevent the propagation or dissemination of the trade secret that is the subject of the action.”[9] The court may issue a seizure order only if specific requirements are met, including: (1) another order or form of equitable relief is inadequate; (2) immediate and irreparable injury exists; (3) the harm to the applicant outweighs the harm of the person against whom seizure would be ordered or a third party; (4) there is a likelihood of success in showing that the information is a trade secret and the person misappropriated the trade secret; (5) the person has actual possession of the trade secret/property; (6) the application describes with particularity the location and item to be seized; (7) the trade secret would be destroyed “if the applicant were to proceed on notice to such person”; and (8) “the applicant has not publicized the requested seizure.”[10] A seizure order must also meet strict statutory requirements.[11] While the DTSA’s stringent requirements make it difficult to pursue a court-ordered seizure of a trade secret, companies now have the ability to recover trade secrets in extraordinary circumstances.

The DTSA offers many financial advantages to companies, including access to exemplary damages (awards of up to twice the amount of damages) and attorney’s fees for the willful and malicious misappropriation of trade secrets.[12] Attorney’s fees are also available if a motion to terminate an injunction is made in bad faith.[13] However, these provisions are not automatic. In order to qualify for exemplary damages and attorney’s fees, the DTSA’s compliance provision requires companies to give notice of the whistleblower protection available under the DTSA.[14]

The broad language of the DTSA means that most agreements and policies require attention. Any Non-Disclosure Agreement, Employee Handbook, Employee Contract, or other agreement “govern[ing] the use of a trade secret or other confidential information” created or executed after May 11, 2016, should be reviewed and updated.[15] Thus, if an employee operating under a contract signed after May 11, 2016, quits and takes valuable trade secrets to a competitor, the employer cannot recover exemplary damages and fees, unless the contract was updated with the appropriate notice requirement. By proactively updating agreements now, companies can save millions in future trade-secret litigation. Failure to act may prohibit litigants from seeking exemplary damages and attorney’s fees in misappropriation suits under the DTSA. Provided the relevant agreements comply with the statutory requirements, the DTSA is a win for virtually all companies and industries. 

Should you have questions about the DTSA and its impact on your business, please contact me or your BrownWinick attorney.

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[1] 18 U.S.C. § 1839 (3).

[2] 18 U.S.C. §§ 1831–1839.

[3] Under Iowa law, the Uniform Trade Secrets Act protects the misappropriation of trade secrets. Iowa Code § 550 (2015).

[4] § 1836 (b)(1).

[5] Id. at (b)(3).

[6] Id. at (d)

[7] § 1838.

[8] § 1836 (b)(2)(A)(i).

[9] Id.

[10] Id. at (ii)(I)–(VIII).

[11] Id. at (b)(2)(B).

[12] § 1836 (b)(3).

[13] Id.

[14] § 1833 (b)(3)(c).

[15] Id. at (b)(3).