The second half of 2014 is an opportune time for us to reflect on employment law challenges we have faced this year, and those that can be expected in the coming year. Here is my take on five employment law challenges that in-house counsel will face in the coming year and how to get out ahead of them.
Retaliation is presently the most frequently cited basis for EEOC charges of discrimination and now accounts for almost 42 percent of all EEOC charges. Another enforcement agency has reported almost a 50 percent increase in complaints from employees alleging unlawful reprisal in a six month period. Recent changes in the law have made it easier for a plaintiff to prevail on a retaliation case than other types of matters. The U.S. Supreme Court recently applied an expansive reading of the anti-retaliation protections in a whistleblower matter.
2. Disability and Pregnancy Rights
There was a 46 percent increase in EEOC charges alleging pregnancy discrimination from 1997 to 2011. The U.S. Supreme Court recently agreed to hear a case involving a pregnant worker who had been denied light duty work and discharged. Laws governing disability rights have been expanded in recent years. The EEOC issued new guidelines for the first time in more than 30 years expanding employers’ obligations with respect to reasonable accommodations for pregnant workers. Many states and local governments have recently passed legislation targeting pregnancy discrimination. As a result, more employees can claim that they are protected by laws governing disability and pregnancy rights; requests for accommodations will increase; lawsuits alleging violations of these rights will increase; and it will be more difficult for employers to prevail on summary judgment in these lawsuits.
3. Increased Scrutiny of Non-Compete Agreements
Many states have recently taken action that significantly narrow the enforceability of non-competes. In Virginia, for example, the Supreme Court of Virginia ruled in 2011 that a covenant not to compete was over broad and unenforceable, even though it was identical to a covenant the court had upheld 22 years earlier. As Virginia has not adopted the “blue pencil” rule, an overly broad and unenforceable provision dooms the entire agreement. This increased scrutiny of non-compete agreements may deprive employers of a valuable tool for protecting confidential information and for preventing unfair competition, requiring reliance on common law and statutory remedies.
4. Eradication of Barriers in Recruitment
The EEOC identified this issue as one of its top enforcement priorities for 2014. The EEOC has also recently issued guidance cautioning employers on the use of employment background checks. Multiple states have enacted “Ban the Box” legislation requiring employers to wait until later in the hiring process before inquiring about a candidate’s criminal record. As of this year, companies that contract with the federal government are required to comply with numerous new rules regarding recruitment of individuals with disabilities, as well as other protected classes.
5. Evolving Benefits Obligations
In 2013, the U.S. Supreme Court ruled that federal laws that apply to opposite-sex spouses must apply equally to same-sex spouses. This ruling invalidated a key provision of the Defense of Marriage Act which defined marriage under federal law as between one man and one woman. In June 2014, the Department of Labor proposed amending the definition of “spouse” under FMLA to include individuals in same-sex marriages. Since June 2013, there have been 18 rulings by federal courts protecting same-sex marriage, one ruling by a federal appellate court protecting same-sex marriage, and six rulings by a state court protecting same-sex marriage.
A comprehensive list of action steps for in-house counsel and their employers is beyond the scope of this post. But here are some steps in-house counsel can take in conjunction with their business leads, compliance officers, and human resources representatives to get out ahead of these impending employment law challenges and create a culture of compliance:
- > Conduct an audit of all personnel policies. Include strong anti-retaliation provisions and multiple reporting channels in personnel policies. Update leave, benefits, and accommodation policies to comply with best practices and updated legal obligations.
- > Collect, track, investigate, and timely respond to complaints; analyze trends in complaints received; and make appropriate program and business improvements in response.
- > Train and educate management and human resources representatives regarding the company’s changing obligations with respect to disability, benefits, and pregnancy rights.
- > Recognize that disputes concerning non-competes may be fully litigated and such restrictions may be closely scrutinized. Use them strategically, and carefully draft such agreements to ensure full compliance with state law.
- > Consider changes that may need to be made to other workplace practices and policies to reflect the evolving judicial, legislative, and regulatory landscape regarding same-sex, disability, and pregnancy rights. This is particularly crucial given the cultural and demographic evolution of the workforce, with increased numbers of so-called “millennials.”