City of Seattle Proposes New Ordinance Regulating Employee Scheduling

Seattle restaurants and retail employers may soon face significant restrictions on employee scheduling.  The Seattle City Council is currently considering a proposed ordinance with the potential to impact hundreds of employers across the City.  Following are the basics of the proposed legislation.

What employers would be covered by the proposed ordinance?

  • Retail employers and large limited or quick food service employers with 500 or more employees worldwide; and
  • Full-service restaurants with 500 or more employees and 40 or more locations worldwide.

What employees would be covered by the proposed ordinance?

  • Hourly, non-exempt employees who work at least 50% of the time within the City of Seattle.

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NLRB Reverses Course Again: Organizing Temporary Workers Just Got Easier

The NLRB recently reversed course again to allow temporary employees provided by a staffing agency to join regular employees in a single bargaining unit without the consent of the employer or the staffing agency. Miller & Anderson, Inc., 364 NLRB No. 39 (2016).

The Board Flip Flops

Historically, unions seeking to organize employees directly employed by an employer (called a “user employer” by the Board) alongside temporary employees provided by a staffing agency (“provided employees”) in a single bargaining unit were required to obtain consent of both the user employer and the staffing agency.

In 2000, however, the Clinton Board overturned that rule to eliminate the consent requirement, allowing employees to form one bargaining unit as long as they shared a community of interest and the employer and the staffing agency were considered “joint employers.” M. B. Sturgis, Inc., 331 NLRB 1298 (2000).  Four years later, the Bush II Board decided Oakwood Care Center, 343 NLRB 659 (2004), and overturned the Board’s decision in Sturgis to again require consent. Continue Reading

OSHA Delays Enforcement of New Reporting Requirements for Drug & Alcohol Testing

As previously reported, OSHA’s latest revisions for covered employers will dramatically impact routine post-accident drug testing programs.  The new rules are available for review here, but here’s what you need to know:

  • OSHA Postponed Enforcement. OSHA just delayed the date on which it will begin enforcing these new requirements. OSHA’s memo postponing enforcement is available here. Now, OSHA will not begin enforcing the new regulation until November 1, 2016.
  • Motivation for Change is Unclear. This delay may not be driven by OSHA’s concerns about employers struggling to assess the rules’ impact on wide-spread drug testing regimes. Rather, employer associations have already sued OSHA, in particular challenging the “retaliation” provisions in the new rules that give rise to the threats to routine drug testing programs. These plaintiffs have sought a preliminary injunction against the Department’s new rule, found here, largely predicated on the original August 10 enforcement date. Given the Department’s recent track record before the federal courts, (see a recent preliminary injunction against the Department here), the delay in enforcement may well be designed to allow the Department additional time to fight the attempt to enjoin the new rule.
  • Who Does this Concern? OSHA’s new regulations are not applicable to most private sector employers in states such as Alaska, California, Minnesota, Oregon, Utah or Washington that have adopted their own state workplace safety plans. While the state plans must be ‘at least as effective’ as OSHA’s rules, many of the state plan states have their own reporting requirements.
  • Timeframe. As we saw when OSHA last changed its reporting requirements in 2014, as can be seen here, for those states with their own workplace safety plans it sometimes takes months (or years) to respond to changes in OSHA’s regulations.   Employers outside those states, which are directly regulated by OSHA, now have until at least November 1 to prepare.

We will keep you abreast of these ongoing developments. In the meantime, please check back to our World of Employment blog regularly for updates or contact your Stoel Rives relationship partner for additional information.

OSHA Promotes Workplace Safety by . . . Limiting Drug and Alcohol Testing?

Employers that promote workplace safety by ensuring workers are not under the influence of drugs or alcohol after they suffer a workplace injury will soon face greater scrutiny from the Occupational Safety and Health Administration (“OSHA”).  A new OSHA rule that goes into effect August 10, 2016 casts serious doubt on whether employers can lawfully maintain mandatory post-incident drug and alcohol testing.

OSHA Thinks Mandatory Testing Deters Reporting

The new OSHA rule becomes effective August 10, 2016, though compliance deadlines may vary from state to state (check with your employment counsel to confirm).  When the rule becomes effective, employers must have a reporting procedure for workplace injuries that is “reasonable and [will] not deter or discourage employees from reporting” workplace injuries.  To which you say, “My business already has that.”  Perhaps you do, but if that procedure includes mandatory post-incident drug or alcohol testing, OSHA may no longer consider it to be reasonable.  Though OSHA claims that “the [new] rule does not prohibit drug testing of employees,” the Agency also states that “mandating automatic post-injury drug testing [is] a form of adverse action that can discourage reporting.”  In other words, OSHA has determined that mandatory post-incident drug and alcohol testing may be unlawful because it may deter someone from reporting an injury. Continue Reading

Portland, Oregon’s More Restrictive “Ban the Box” Ordinance

Portland, Oregon’s new “ban the box” ordinance went into effect on July 1, 2016.  We blogged about Oregon’s statewide “ban the box” law here.  Portland’s new ordinance is more restrictive and prohibits covered employers from conducting criminal background checks until after a conditional job offer is made.  Detailed information about the new ordinance is available here.

Are You a Covered Employer?

The Portland ordinance applies to private companies that have six or more employees, with at least one employee who spends a majority of his or her time working within the City of Portland.

You are completely exempt from the law if:

  1. You have fewer than six employees;
  2. Federal, state, or local law requires you to consider an applicant’s criminal history;
  3. You are a law enforcement agency or part of the criminal justice system; or
  4. You are seeking a nonemployee volunteer.

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2016 Oregon Legislative Update: What You Might Have Missed

Oregon’s new minimum wage law, signed by Governor Brown on March 2, 2016, received a lot of press during the 2016 legislative session.  This new law establishes a tiered system for determination of the minimum wage based on the location of the employer.  The minimum wage will increase annually on July 1 of each year, with the first increase (from $9.25 to $9.50 in rural areas and to $9.75 everywhere else) taking place this year.  By 2022, Oregon’s minimum wage will increase to $14.75 inside Portland’s urban growth boundary, $13.50 in midsize counties, and $12.50 in rural areas. The full text of the enrolled Senate bill is available here.

With minimum wage receiving all of the attention, Oregon employers may have missed other employment-related bills.  Here are the bills that passed during the 2016 Oregon Legislative Session and those that failed (but we might see again in the future). Continue Reading

DOL Imposes New Exempt Salary Requirement on Employers

We knew it was coming, and – while business groups fought hard against it – the much-anticipated Department of Labor Final Rule regarding “white collar” exemptions from minimum wage and overtime requirements is now a reality. The rule, announced by the White House on Twitter last evening, imposes a major increase in the salary threshold for exempt workers. The effect on employers will be equally substantial. The change will require employers to revisit their exempt classifications. Starting December 1, any employee who currently makes less than $47,476 will be automatically eligible for overtime for work performed over 40 hours in a week, regardless of their job responsibilities. That leaves employers with three choices for those workers:

  1. Increase their annual salary to at least $47,476;
  2. Pay them time-and-a-half for hours worked over 40; or
  3. Limit their work to 40 hours or less in a work week.

Industries with large segments of management workers below the new threshold, such as restaurants, retail, hotels, and nonprofits, will be most impacted by this new rule. But all employers should take time to review whether their exempt workers will still be exempt come December 1. If not, choose from among the three options above.

Read on for our full discussion of the Final Rule, including information on anticipated changes to the Executive Duties Test that didn’t make it into the final rule, and the prospects for Congressional efforts to block the rule.

U.S. Supreme Court rejects challenge to Seattle minimum wage law

On May 2, 2016, The U.S. Supreme Court declined to hear the legal challenge to the Seattle Minimum Wage Ordinance’s impact on Seattle franchisees (IFA v. Seattle–denial of cert).  We have blogged about Seattle’s Minimum Wage Ordinance (“Ordinance”) before. The Ordinance requires large businesses, defined as those with more than 500 employees, to raise the minimum wage they pay their employees to $15 an hour over four years starting in April 2015. Smaller businesses have five years to phase in the wage increase.

The Ordinance groups franchisees with their franchisor in determining whether they are a large employer or not.  Many Seattle franchisees are categorized as “large” employers under the Ordinance, even if they would otherwise be “small” employers who would have more time to comply with the law.  These franchisees will be required to pay a $15 minimum wage as of January 1, 2017, unless they contribute to medical benefits, in which case the phased in minimum wage goes to $15 for such franchisees as of January 1, 2018. The IFA lawsuit had argued that a franchisee should be considered an independent local business owner who operates separately from its franchisor.

Seattle was the first major city to institute a phased in $15 minimum wage, setting off a wave of similar laws in other U.S. cities and states.

What Tom Brady, Underinflated Footballs, and “Deflategate” Teach Employers About Arbitration

Fans of unscrupulous professional football players and coaches often justify their heroes’ misbehavior with a now-classic sports adage: “If you ain’t cheatin’, you ain’t tryin’.”  In the 1970s, for example, legendary Oakland Raiders owner Al Davis allegedly bugged locker rooms, watered down fields, and spied on other teams using a helicopter.  Such extreme shenanigans are less prevalent in today’s NFL, but they still happen.  And as superstar New England Patriots quarterback Tom Brady now knows, it helps a lot if you don’t get caught.  And if you do, the Second Circuit has made even more clear the very high degree of deference afforded to arbitration awards.  This decision serves as a stark (and, for Patriots haters, richly satisfying) reminder that courts have no business reviewing the merits of an arbitrator’s award.

During the second quarter of last year’s AFC championship game—i.e., a game that determined one-half of that year’s Super Bowl matchup—an Indianapolis Colts linebacker intercepted a Brady pass.  Sensing that something was amiss, he turned the ball over to the Colts’ coaching staff.  They determined that the ball was underinflated in violation of league rules, which require a minimum pressure of 12.5 psi.  (Particularly in the cold, wet conditions in which the game took place, underinflated footballs generally are easier to grip, throw, and catch.)  After the Colts alerted NFL officials to the problem, the League tested all of the game balls at halftime.  Each of the four balls provided by the Colts tested within the permissible range.  Each of the Patriots’ eleven balls tested below 12.5 psi.  Uh oh.

Tom Brady Wins Round One in District Court

The NFL retained counsel to investigate the matter, which has since become known as “deflategate.”  The investigation concluded that it was “more probable than not” that two Patriots equipment officials had improperly deflated the Patriots’ footballs before the game began, and—though the evidence was somewhat less clear on this point—that Brady had at least tacitly approved of the scheme.  #ThingsTomBradyDoes  As a result of the investigation, and under a collective bargaining agreement (“CBA”) between the NFL and the NFL Players’ Association, League Commissioner Roger Goodell decided to suspend Brady for the next season’s first four games.  Brady appealed the decision, and a labor arbitration ensued.  As was his right under the (very unusual) CBA, Goodell himself served as the arbitrator.  Shortly before the hearing, it also came to light that, on the day of his interview with the NFL’s investigators, Brady destroyed his cell phone, which he previously had refused to make available for inspection.  (We and the greater Boston area are confident he had a perfectly legitimate reason for doing so.)  To absolutely nobody’s surprise, Goodell upheld Brady’s suspension.

Tom Brady, however, is not a quitter, and the matter didn’t end there.  On his behalf, the NFL Players’ Association sued the NFL in federal district court to vacate the arbitration award.  The district judge later vacated the award based on (1) “inadequate notice to Brady of both his potential discipline (four-game suspension) and his alleged misconduct,” (2) “denial of the opportunity for Brady to examine one of two lead investigators,” and (3) “denial [to Brady] of equal access to investigative files, including witness interview notes.”

The Second Circuit Reverses

On Monday, the Second Circuit reversed.  The court began its analysis by observing that its role was limited to “ensur[ing] that the arbitrator was ‘even arguably construing or applying the contract and acting within the scope of authority’ and did not ‘ignore the plain language of the contract.’”

Its ruling also emphasized the broad authority that the CBA conferred on the NFL:

“[T]he players and the League mutually decided many years ago that the Commissioner should investigate possible rule violations, should impose appropriate sanctions, and may preside at arbitrations challenging his discipline.  Although this tripartite regime may appear somewhat unorthodox, it is the regime bargained for and agreed upon by the parties, which we can only presume they determined was mutually satisfactory.”

Rejecting the district judge’s three grounds for vacating the award, the Second Circuit concluded that that the parties’ CBA—unorthodox as it was—gave Goodell “broad authority to deal with conduct he believes might undermine the integrity of the game,” that the CBA thus gave Brady adequate notice that he might be suspended for his misconduct, and that Goodell’s other decisions were firmly grounded in the CBA’s language.  As crazy as Goodell’s multi-purpose role in the arbitration might sound, the parties had previously agreed to it.

Lessons for Employers

Even Patriots rivals can agree that the CBA gives Goodell extraordinary power.  On Wednesday, New Orleans Saints quarterback Drew Brees lamented Goodell’s power under the CBA, which, he said, places Goodell in the position of “judge, jury, and executioner when it comes to all the discipline” and which has been a “black eye” for the NFL.  Problem is, the NFL Players’ Association should’ve negotiated a provision that would require appointment of an impartial arbitrator if it thought having the Commissioner serve as the arbitrator would be problematic.  The answer, as the Second Circuit has made clear, is not to look to the courts for help.  Whether one is a Patriots fan (Ed) or not (Todd—Go Niners!), this decision underscores the high level of deference that courts afford to an arbitrator’s award.  Even if you’re Tom Brady.

California Employers Must Carefully Reconsider Whether Employees Can Be Provided With “Suitable Seats” In Light of New Decision

A recent California Supreme Court decision has the potential to affect all California employees who are required to stand while performing parts of their job.  In response to numerous lawsuits brought by cashiers, retail employees, bank tellers and other employees, the California Supreme Court clarified the meaning of a decades-old law that requires employers to provide their employees with “suitable seats” when the nature of the work permits it.  The Court rejected the interpretation favored by employers—creating instead an interpretation that will make it more difficult for employers to deny their employees a seat.

As a result of this decision, California companies must give careful consideration to whether their employees can perform any of their tasks while sitting.  Employers who fail to provide seats when the nature of the work would reasonably permit their use face significant penalties.

Suitable Seating Laws

Different variations of seating laws have been in place in California since 1911.  The current language dates back to 1976, when the Industrial Welfare Commission modified a wage order to require that “all working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats.”  The wage order also requires that “when employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area and employees shall be permitted to use such seats when it does not interfere with the performance of their duties.” Continue Reading