Until recently, my answer would have been nothing. But, in life, change is certain. In February, my son Bryan offered to take me skydiving for my 58th birthday present. As when dealing with clients, I couldn't back down in the face of adversity, so I said yes. And the three and one half month journey began.
Saying yes was comparable to when a client retains my services. There is always a beginning, when my services are retained. There is the paperwork. There is the wait, especially when litigation is involved. This can lead to some sleepless nights, like I had thinking about jumping out of an airplane. And the end: when the issue is resolved. Hopefully, a soft landing, like the one I experienced, is involved.
I believe what I learned most from jumping out of a perfectly good airplane is that there is a big picture and a small picture of every situation. Boarding the plane before takeoff, the ground was firm and secure, and the landing zone looked really big. From 14,000 feet, the landing zone was virtually invisible, and the further I fell away from the plane, the smaller it looked.
So today, let's look at the big picture of employment law. As we approach the end of President Obama's second term, much has changed in the employment world. Same sex marriage. Which bathroom to use. The doubling of the amount of the overtime exemption. The adoption by numerous states and cities of minimum wages in excess of the federally mandated $7.25 an hour. Legalization of marijuana, both for recreational use and for medical use. An empty Supreme Court seat. And much more.
The past two months have been extremely busy. What has happened?
- I have previously written about the Final Overtime Regulations. Some points to ponder about the practical impact of the changes:
- There were two policy objectives set forth by the DOL: first, “spread employment..by incentivizing employers to hire more employees rather than requiring employees to work longer hours;” and second, to “reduce overwork and its detrimental effect on the health and well-being of workers.” Furthermore, the DOL estimates that employers will face an increase in costs of tracking hours of at least $677 million. And, as Trey Kovacs wrote in an opinion piece, “Obama's new overtime rule was never intended to raise your wages.”
- A number of years ago, as the result of the settlement of a lawsuit, IBM reclassified 7,000 salaried and tech support employees as overtime eligible. However, the total compensation of the workers was not changed as a result of a 15 percent reduction in their base pay. James Sherk, in a commentary in the Daily Signal, pointed out that as a result of the new overtime rule, flex time may be eliminated, policies may be implemented that overtime will not be permitted, and that although “[t]he Labor Department says this regulation will help workers[,] it is much more likely to make balancing work and family even more difficult.”
- Non-profits will be especially hard hit by the changes. The DOL issued guidance entitled “Overtime Final Rule and the Non-Profit Sector”. I would encourage any non-profit agency to review this guidance carefully and consult with your legal counsel to ensure compliance with the changes.
- The federal Defend Trade Secrets Act (DTSA) become effective on May 11, 2016 when President Obama signed it into law. The DTSA applies to any misappropriation of trade secrets after May 11. The DTSA, in large part, follows the Uniform Trade Secrets Act, which has been implemented in some form in many states, including Alabama. The DTSA addresses numerous issues, including:
- Employers are required to include a notice of whistleblower immunity in contracts with employees, contractors or consultants that gives employees the right to turn over protected trade secrets to the government or an attorney if illegal conduct is suspected.
- Exemplary damages in an amount not more than twice the damages awarded and attorneys' fees may be awarded if the protected trade secret is “willfully and maliciously” misappropriated.
- Employers with information protected under the DTSA should immediately take steps, including, but not limited to, train employees about the requirements of the new law, provide written notice of the whistleblower immunity provision, adopt appropriate policies and confirm that proper steps are being taken to properly protect trade secrets protected by the DTSA.
- Federal courts now have jurisdiction over trade secrets disputes pursuant to the Federal Economic Espionage Act. Alabama courts, as well as other states that have state trade secrets laws, continue to have concurrent jurisdiction.
- The DTSA provides for ex parte seizures by federal law enforcement agencies if “necessary to prevent the propagation or dissemination of the trade secret” in “extraordinary circumstances” similar to a traditional injunction.
- Once again, any employer with trade secrets should take action immediately to ensure compliance with the DTSA and make sure that their trade secrets are protected.
- On May 16, 2016, the EEOC issued Final Rules on Employer Wellness Programs. Of particular importance:
- The effective date is the first day of the first plan year beginning on or after January 1, 2017.
- The final ADA rule, according to the EEOC press release, “provides that wellness programs that are a part of a group health plan and that ask questions about employees' health or include medical examination may offer incentives of up to 30 percent of the total cost of self-only coverage.”
- The Final GINA rule, according to the same press release, “provides that the value of the maximum incentive attributable to a spouse's participation may not exceed 30 percent of the total cost of self-only coverage, the same incentive allowed for the employee.”
- Both rules have requirements that the program must be voluntary and confidential.
- The EEOC has published question and answer documents on both the ADA Rules and the GINA Rules.
- If an employer has a Wellness Plan in place, or is contemplating implementing one, compliance with the EEOC rules is essential. These are complex and complicated rules, and consultation with an attorney is recommended.
Practice pointer. Changes in the laws and regulations covering employers are happening at warp speed. And I predict this trend will continue through the November elections, and maybe into January depending on the outcome of the various elections. Now is the time to review and update policies and procedures, as well as documentation, including non-compete and confidentiality agreements, to ensure compliance with the changes set out above.