Regulatory UpdatesJune 25, 2018
In a flurry of legislative activity in New Jersey and New York this year, several new laws have been recently adopted in each state. As a recap, here is a list:
New Jersey’s new Equal Pay Act, effective July 1, 2018, amends the New Jersey Law Against Discrimination (“LAD”). This new law provides significant new money damages and extends the statute of limitations for aggrieved employees of any protected characteristic (not just gender) who claim a pay disparity. The new law also places the burden on the employer to justify any pay disparity that exists. Also, expect several more employment laws to be signed into law in calendar year 2018 in New Jersey.
New York State amended its Human Rights Law to impose liability against employers who fail to prevent harassment against non-employees (contractors, vendors, consultants, etc.) in the workplace.
New York State now bars the use of mandatory arbitration clauses to resolve sexual harassment claims. This new law is effective July 11, 2018 although, in light of the U.S. Supreme Court’s recent decision affirming the use of employee arbitration agreements, this law may be the subject of litigation in the future.
New York State, effective July 11, 2018, will prohibit, with an exception in some cases, the use of confidentiality and non-disclosure agreements relating to sexual harassment claims. This new law is effective July 11, 2018.
New York State will require employers to have a written anti-harassment policy as well as annual training. Although these two best practices have historically been recommended to employers, they will now be required by law in New York State, effective October 9, 2018. The New York State Department of Labor will be publishing model policies and training programs and your company should customize those policies to fit the workplace.
Similarly, New York City amended the New York City Human Rights Law to require anti-harassment training to most employers, expand the coverage of the law against sexual harassment claims, and lengthen the statute of limitations for those claims. The mandatory training component of the law will take effect April 1, 2019.
New York City also amended its own Earned Sick Time Act to provide additional job-protected leave for absences relating to family offenses, sexual abuse, stalking, and human trafficking – known as “safe” time. This law contains another amendment, effective July 18, 2018, to require employers to grant schedule changes (temporarily) two times per calendar year for leave reasons covered by the Earned Safe and Sick Time Act.
New York City expanded the definition of sexual orientation and gender under the New York City Human Rights Law
Finally, effective October 15, 2018, the New York City Human Rights Law will require that employers engage in a cooperative dialogue in response to employee requests for reasonable accommodations relating to religious, disability, pregnancy, childbirth or related conditions, or victims of domestic violence needs. The employer’s decision must be put in writing setting forth the accommodations granted or denied.
Potential New Jersey Equal Pay Law Has Plaintiff's Lawyers Licking Their ChopsMarch 29, 2018
Recently, both Houses of New Jersey’s legislature overwhelmingly passed the “Diane P. Allen Equal Pay Act” which is now destined for the Governor’s signature. This sweeping new equal pay legislation amends the New Jersey Law Against Discrimination (“NJLAD”), and makes it unlawful “[f]or an employer to pay any of its employees who is a member of a protected class at a rate of compensation, including benefits, which is less than the rate paid by the employer to employees who are not members of the protected class for substantially similar work, when viewed as a composite of skill, effort and responsibility.” It applies to all of New Jersey’s already protected classes. While there are exceptions for bona fide differences in education and experience, this law will substantially increase the burden on your businesses to make sure these disparities either don’t exist, or if they do – that they are defensible. While the NJLAD already provided for compensatory and punitive damages for employees who are the victims of unlawful employment practices, this amendment allows for treble damages. While this bill is not yet law, we will be watching this legislation closely.
2018 Qualified Plan LimitsNovember 2017
Qualified retirement plans, such as Internal Revenue Code sections 401(k) and 403(b) plans, pension and profit sharing plans, individual retirement accounts (IRAs), and health flexible spending accounts (Health FSAs) are subject to various dollar limits on the amount of contributions that can be made or benefits that may accrue under such arrangements. Most of these dollar limits are adjusted annually by the IRS for changes in the “cost of living.”
For 2018, some of the key dollar limits affecting the above plans, IRAs and Health FSAs are as follows:
2018 Dollar Limit
|1. Elective Deferral Contributions (for 401(k) and 403(b) Plans)||$18,500 ($500 increase from 2017)|
|2. Annual Contribution Limit (for defined contribution plans)||$55,000 ($1,000 increase from 2017)|
|3. Annual Benefit Limit (for defined benefit plans)||$220,000 ($5,000 increase from 2017)|
|4. Annual Compensation Limit (for all qualified retirement plans)||$275,000 ($5,000 increase from 2017)|
|5. Catch-Up Deferral Contributions (for plan participants age 50 or older under 401(k) and 403(b) plans)||$6,000 (no change from 2017)|
|6. Highly Compensated Employee definition-compensation threshold (for nondiscrimination testing under all qualified plans, especially 401(k) and 403(b) plans)||$120,000 (no change from 2017)|
|7. Traditional IRA Contribution Limit (IRA contribution deduction amount subject to income based phase-out)||$5,500 (no change from 2017)|
|8. Catch-Up Traditional IRA Contribution (for individuals age 50 or older)||$1,000 (no change from 2017)|
|9. Health FSA Contributions (via employee salary deferrals)||$2,650 ($50 increase from 2017)|
While the above benefit and contribution limits should be, as applicable, reflected in the plan documents for such plans and accounts, and in the operation of such arrangements, it is important to remember that the elective deferral and, as applicable, related catch-up contribution limits apply on an individual basis. Thus, if you change jobs during calendar year 2018 and participate in two or more employer-provided 401(k) and/or 403(b) plans, you are entitled to a maximum aggregate elective deferral and catch-up contribution limit under all such plans for 2018 of $18,500 in elective deferrals and $6,000 in catch-up contributions (i.e., one set of elective deferral and catch-up contribution limits apply per individual per calendar year).
HR Tip of the Month: Don't be a Dope About Opioids in the WorkplaceJuly 2017
The pernicious opioid epidemic sweeping the nation is well known, and at some point employers may have to deal with an employee who has a substance abuse problem. These situations have implications on everything from workplace drug testing, medical leave laws, and reasonable accommodations to employee assistance programs.
Typically, employers will start to notice signs of opioid abuse including frequent lateness, poor attention to detail and a general drop in performance. Nothing prohibits an employer for terminating an employee for poor performance. However, if the employee comes to the employer before the employer takes any disciplinary action and says they have a substance abuse problem, this changes everything and employers must treat the situation delicately.
Generally, employees who are currently using illegal drugs are not considered “individuals with disabilities.” However, individuals addicted to drugs but who are no longer using and receiving treatment for addiction may be protected by disability discrimination laws. Under New Jersey and Federal medical leave laws, employees are generally entitled to job protection if they seek an unpaid leave to attend rehab. When they return, they may need other accommodations. For example, if an employee requests time off or a revised schedule to attend Narcotics Anonymous meetings or other support groups, those requests need to be considered in good faith by an employer as part of the interactive process to determine reasonable accommodations under New Jersey and Federal law.
These types of employee issues can be riddled with pitfalls for the unknowing employer and sometimes even the knowledgeable employer. These employee issues are rarely, if ever, resolved at once. Remember to be patient, tread lightly, and always consult with legal counsel before taking any action.
HR Tip of the Month: Understand The Benefits of Severance Pay, The Law And How To Do It RightJune 2017
Generally speaking, the law does not require payment of severance to a terminated employee unless the employer has contractually agreed to do so through some form of agreement or policy. As a result, some employers may question why they should offer severance pay. The most common answer is that the severance pay is conditioned upon the terminated employee providing a release of claims. Therefore, an offer of severance can be a cost-effective means for an employer to avoid the time, expense, disruptions and uncertainties that come with a lawsuit or threatened lawsuit. However, the request for a release of claims will trigger certain legal requirements and obligations. For example, under the federal age discrimination law, employees that are 40 years of age or older must be provided 21 days (and sometimes as much as 45 days) to accept the severance offer and 7 days to revoke their acceptance of said offer. Other laws may limit the employee's ability to release certain claims. Employers should consult with their counsel to insure their severance agreements are legally compliant and to insure that they fully understand the impact of the law on said agreements.
HR Tip of the Month: Getting into the Weed(s) with Medical Marijuana in New JerseyMarch 2017
In 2010, New Jersey passed the New Jersey Compassionate Use Medical Marijuana Act (“NJCUMMA”) which protects the users of medical marijuana “from arrest, prosecution, property forfeiture, and criminal and other penalties.” The law specifically provides that employers are not required to “accommodate the medical use of marijuana in . . . [the] workplace,” but is silent about an employer’s duty to accommodate medical marijuana use outside the workplace. While the New Jersey Law Against Discrimination requires an employer make reasonable accommodations to a disabled employee who can perform the essential functions of the job, the law is hazy when it comes to whether those reasonable accommodations include allowing an employee to use medical marijuana outside of the workplace. This dilemma can present some sticky situations for employers. For example, what is required of an employer who maintains a zero tolerance drug policy, but is confronted with an employee who tests positive for marijuana because of their underlying disability? Given this budding area of the law; for now these situations should be addressed on a case by case basis taking into account the employee’s job description, the underlying disability, the circumstances prompting the drug screen, etc.
HR Tip of the Month: Politics in the Workplace, Understand the Legal RisksOctober 2016
Some employers may seek to ban political discussions because of its potential to disrupt the operation of the office. What managers and employers don’t always appreciate is that politics in the workplace may trigger certain legal rights and obligations.
Many employees are under the mistaken belief that they have a constitutional right to talk politics in the workplace. However, the First Amendment to the U.S. Constitution (i.e., the right to “freedom of speech”) only applies to actions by the government, not private employers. As such, as a general rule, private employers are free to prohibit political discussions in the workplace. However, this general rule may be trumped (no pun intended) by the National Labor Relations Act (“NLRA”). The NLRA applies to both unionized and non-unionized employers and protects the rights of employees to engage in concerted activity (e.g., to discuss the terms and conditions of employment). Therefore, under the NLRA, an employee may have a right to talk about a candidate’s policies as they relate to minimum wage or overtime laws.
Additionally, given some of the “hot button” issues in the current presidential election, political speech may result in employee claims of harassment and discrimination. For example, a hostile work environment could arise if employees are subjected to unwelcome discussions on immigration, equal pay for women or abortion rights. Conversely, disciplining the employee who discusses such political issues could result in a claim of retaliation (e.g., a woman discussing equal pay legislation could argue she was disciplined in retaliation for her speaking out on discriminatory pay policies).
Employers should insure that all policies and actions relating to political speech are compliant with applicable law. Further, employers in New York are reminded that they are obligated under certain circumstances to provide employees with paid time off to vote. New Jersey has no such law; however, it a crime in New Jersey for an employer to intimidate, threaten, or use violence to induce, compel or coerce any employee to vote for a particular candidate.
HR Tip of the Month: If Retaliation Claims Still Are Not On Your Radar, You Need To Adjust Your AntennaSeptember 2016
As discussed below, the U.S. Equal Employment Opportunity Commission recently issued new enforcement guidance on how broadly (very) it interprets the anti-retaliation protections contained in the various employment discrimination statutes the agency enforces. These statutes contain provisions that make it unlawful for an employer to take an adverse employment action against any employee or applicant who engages in a protected activity. A protected activity can be either participating in an EEO process (including internal investigations according to the EEOC) or opposing a perceived unlawful EEO practice. The new guidance will sound familiar to employers who work their employment counsel regularly on discipline and internal investigation issues. But the most obvious take away from this new guidance for employers is: it is not reasonable any longer to conduct an internal investigation or discipline employees without “checking-in” with your employment counsel first. That 15 minute check in can often times avoid a claim or, if a claim arises, ensure that the company has a defense.
EEOC’s New Enforcement Guidance on Retaliation ClaimsSeptember 2016
The U.S. Equal Employment Opportunity Commission (“EEOC”) recently issued new enforcement guidance on retaliation claims under the various federal employment laws it enforces, which include Title VII of the Civil Rights Act of 1964 (“Title VII”), the Americans with Disabilities Act (“ADA”), and the Age Discrimination in Employment Act (“ADEA”). This new guidance is significant not only for the agency’s interpretation of what acts constitute retaliation but also because many states follow the EEOC’s lead in interpreting their own State employment discrimination laws. The new guidance confirms what labor and employment attorneys have known for some time: that retaliation claims have been on the rise for several years and they are often more difficult to defend than traditional discrimination claims. That is because the employer actions that constitute an “adverse employment action” for a retaliation claim are far broader than for a discrimination claim. With the new guidance, the EEOC issued a question and answer sheet that employers should review as the start to implementing workplace training to supervisors and managers so they do not engage in retaliatory behavior.
While You Are on Vacation, the U.S. Equal Employment Opportunity Commission is Staying Busy This SummerJune 2016
In a flurry of activity this month, the U.S. Equal Employment Opportunity Commission (“EEOC”) has announced:
Its task force formed in 2015 to study harassment in the workplace has called on employers to “double down” and “reboot” workplace harassment efforts. To read the report and the EEOC’s comments, click here.
It is seeking input on proposed national origin discrimination guidance. To read the draft guidance and the EEOC’s comments about the effort, click here.
Effective July 5, 2016, it has increased its penalties for failure to post notices required by Title VII, the ADA, and GINA by 150%. The fines will increase from $210 to $525 per violation.
New Jersey Supreme Court Rules That Unlawful Marital Status Discrimination Includes Employees Who Are In the Process of Getting DivorcedJune 2016
In another decision by the New Jersey Supreme Court, in Smith v. Millville Rescue Squad, the Court held that “marital status,” which is a protected class under the New Jersey Law Against Discrimination (“LAD”), includes employees who are separated from their spouse and who are in the process of getting a divorce. The employer in this case allegedly terminated an employee because the employer believed the employee would have an “ugly divorce.” This case involved a husband and wife who both worked for the employer, and the husband then had an affair with a volunteer worker. The Court interpreted the “marital status” protected class as including employees who have never married, who are engaged, separated, involved in divorce litigation, or recently widowed. The takeaway for employers from this case is not to let an employee’s separation or pending divorce factor into any employment decisions.
New Jersey Supreme Court Rules Against Shortened Statute of Limitations for Employment Discrimination ClaimsJune 2016
In a long awaited decision by employers, the New Jersey Supreme Court, in Rodriguez v. Raymours Furniture Company, Inc., reversed two lower court decisions and held that an employer in New Jersey cannot shorten the two year statute of limitations for an employee or prospective employee to bring an employment discrimination or other claim under the New Jersey Law Against Discrimination (“LAD”). The employer in the case had a provision in an employment application that required the employee to bring any claims within six months of the date of the alleged adverse employment action. The takeaway from this decision for employers is that any employment agreements or other policies that purport to shorten the LAD’s two year statute of limitations are unenforceable in New Jersey.
HR Tip of the Month: Do You Remember the Last Time You Reviewed Your Company’s Handbook?June 2016
With the New Jersey Supreme Court’s recent decision declaring unlawful an employment application provision shortening the statute of limitations to bring a claim under the Law Against Discrimination (discussed below), it is important for employers to remember that the best designed and intended policies are always subject to judicial interpretation and scrutiny. And a company can never be certain that a policy implemented previously will still be enforceable years later. It is important for companies to evaluate their handbooks and policies annually, and work with their labor and employment attorney when doing so, to ensure the policies are up to date and enforceable.
HR Tip of the Month: When Taking Adverse Employment Actions, Don’t Forget To Consider The Risk Of A Whistleblower Retaliation ClaimFebruary 2016
Many employers now understand that before they take an adverse employment action (e.g., an action related to a hiring, promotion, raise, bonus or termination), they should evaluate the potential for the employee to assert a claim of discrimination or harassment. However, when taking such actions, employers sometimes fail to consider the issue of whether the employee has engaged in protected “whistleblowing” activity. Although the federal and state whistleblowing laws vary, New Jersey’s law (the Conscientious Employee Protection Act (CEPA)) is particularly broad and prohibits retaliation against employees who disclose, or threaten to disclose, any activity which the employee reasonably believes to be a violation of a law, rule, or regulation (i.e., an actual violation of a law, rule or regulation is not required). By way of example, CEPA claims can be based upon the employee’s incorrect complaint that the employer has violated the wage and hour/overtime laws, engaged in billing improprieties or made misrepresentations to shareholders, investors, clients, patients or customers. In addition, for licensed or certified health care professionals, complaints about improper quality of patient care (even if not true) may be protected. When determining whether to proceed with any particular employment related decision, employers must consider not only whether the employee is in a protected category under the applicable discrimination laws, but whether the employee has made any type of complaint that could give rise to a claim of whistleblower retaliation.
HR Tip of the Month: Retaliate Against Employees You Say? Not Me.January 2016
By now, most employers are aware of the various protected traits and characteristics that an employer is prohibited from considering in hiring, discipline and termination decisions. But the still lesser understood area – although perhaps more costly and difficult to defend – are retaliation claims. That is, claims by an employee that he was terminated or suffered another adverse employment action because he either opposed or complained about an unlawful employment practice. Federal and state anti-discrimination laws have long contained anti-retaliation provisions yet these claims are still on the rise. According to the U.S. Equal Employment Opportunity Commission (“EEOC”), the issue is so critical that it recently issued new enforcement guidance to employers regarding the breath and scope of the anti-retaliation provisions of Title VII of the Civil Rights Act of 1964 (click here to review the new guidance). It is upon Title VII that most state’s anti-discrimination laws are based, which causes many courts to rely upon the EEOC’s various enforcement guidance documents. So on your 2016 planning list, make sure your company has planned a training session for its managers on best practices when an employee makes a complaint of unlawful discrimination so as to avoid turning a plain vanilla discrimination claim into a retaliation claim.
New York State and City – New Regulations on Unlawful Harassment and DiscriminationJanuary 2016
On January 20, 2016, new regulations under the New York State Human Rights Law relating to unlawful discrimination and harassment on the basis of gender identity, transgender status, and gender dysphoria became effective. The new regulations make clear that discrimination or harassment based upon these protected classes is unlawful, in addition to requiring employers to make reasonable accommodations for persons who fall into the gender dysphoria class. To read the regulations or the Division on Human Rights’ comments, click here.
So too the New York City Human Rights Commission recently issued guidance to employers on the broad scope of the meaning of “gender” under the New York City Human Rights Law. To read the new guidance click here.
HR Tip of the Month: Employee Performance Reviews... Are You Doing It Right?September 2015
Many employers still make the mistake of either not conducing periodic performance reviews or conducing reviews but not doing them “right”. To be done “right”, performance reviews should not be a once a year proposition. Throughout the year supervisors should be clarifying expectations, setting objectives and goals, providing feedback and documenting each of the foregoing. Employees that are not meeting expectations should be told so in a very direct, but constructive, manner. Conducting performance reviews right will not only help your employees achieve their fullest potential, but perhaps even more important, it will help limit the company’s risk of litigation. Conversely, the risk of discrimination, harassment and retaliation claims are significantly increased where decisions regarding important terms and conditions of employment are not supportable by documented performance reviews (e.g., decisions regarding promotions, raises, bonuses, work assignments, work accommodations, training opportunities, discipline, layoffs and termination).
There is no question that the performance review process can require a significant investment of time and energy, but it is an investment worth making. As your company approaches the year end, it is a good time to evaluate your performance review process and to make any necessary changes to insure it is being done right.
NYC Ban the Box Law PassedJune 2015
In the fall of 2015, New York City employers will need to comply with New York City’s new Fair Chance Act, commonly known as “ban the box.” This law amends the New York City Human Rights Law, which is one of the more employee-friendly anti-discrimination laws in the country. The amendment bars most employers in the five boroughs of New York City from stating in a job advertisement that a conviction or arrest will disqualify an applicant from employment. The amendment also prohibits an employer from inquiring about an arrest or conviction prior to making a conditional job offer. Once the employer learns of an arrest or conviction, it cannot revoke the conditional job offer without first providing the applicant with a written copy of the record on a form to be drafted by the NYC Commission on Human Rights, perform an analysis of whether the arrest or conviction is directly related to the job or poses an unreasonable risk to public safety or welfare, and, finally, provide the applicant with a reasonable time to respond (no less than three days) during which the position must be held open.
US DOL Issues Revised FMLA Leave Designation NoticesJune 2015
The U.S. Department of Labor (DOL) recently amended several FMLA leave related forms that employers rely upon in complying with their FMLA obligations. The revisions add language complying with the Federal Genetic Information Non-Discrimination Act (GINA). The forms that were revised are: the Certification of Health Care Provider for Employee’s Serious Health Condition (Form WH-380-E); Certification of Health Care Provider for Family Member’s Serious Health Condition (Form WH-380-F); Certification for Serious Injury or Illness of a Current Servicemember for Military Family Leave (Form WH-385); and Certification for Serious Injury or Illness of a Veteran for Military Caregiver Leave (Form WH-385-V).
HR Tip of the Month: Are You Sure Your Company is Complying With Family Leave Laws?June 2015
Although the Federal Family Medical Leave Act (FMLA) has been around for over twenty years, many employers still do not get it right when it comes to their obligations to notify their employees generally of their rights, respond correctly to employee requests for leave, correctly calculate and designate leave to which an employee is entitled, or to reinstate an employee when legally required to do so. And in New Jersey, like several other states, employers are doubly tripped up on the interplay of the New Jersey Family Leave Act (FLA), which in some situations runs concurrent with the federal FMLA yet does not in other situations. Compounding the compliance conundrum in states like New Jersey is the further interaction of the Temporary Disability Benefits Law and the Paid Family Leave Law.
Compliance with these laws - and more importantly working with counsel to ensure your human resources professionals do not get tripped up by the constantly shifting sands in this area - is imperative to avoid claims by employees of failure to provide leave, interference with leave rights, and retaliation for taking leave. Considering that such claims are usually accompanied by a companion discrimination claim, employers must prioritize compliance with the web of federal and state leave laws.