My law partner, Gabe Jiran, talks today about whether it’s all that easy to change the terms of a collective bargaining agreement.  Is it just as easy as a vote? Or does it require something more? The answer has implications for all employers.  

With all of the talk about the financial difficulties faced by the government, I, and others in here, sometimes get the question of whether the State of Connecticut or other states might try to change the laws on collective bargaining or try to pass legislation to alter the terms of its existing collective bargaining agreements.

Other states have started down this road, but it is not that easy.

Recently, the Connecticut Attorney General was asked to opine on whether the General Assembly could statutorily change the contracts covering State employees to address the fiscal crisis.  A link to the opinion is here.

The short answer is that the State could do so, such as by passing a statute that wage increases be delayed or eliminated in State contracts.

However, the United States Constitution imposes a pretty heavy burden on the State to justify any such changes.

The relevant factors are:

  1. the severity of the fiscal crisis;
  2. the nature and duration of the contractual changes;
  3. the extent that the State has attempted to implement other alternatives in the past;
  4. the extent to which the State has studied and made findings about the feasibility of other alternatives;
  5. whether these alternatives would be a less dramatic option;
  6. the extent to which the fiscal crisis existed or was foreseeable when the State entered into the existing contract; and
  7. the State’s representations during negotiations for the existing contract.

Based on cases utilizing some or all of these factors, the State would face an uphill battle if it wanted to change an existing contract.

For example, a federal appeals court struck down the State of New York’s plan to delay wage increases for employees because New York had alternatives such as raising taxes or shifting money around in its budget.  In another New York case, the same court found that a $1 billion deficit was not a dire enough fiscal crisis to justify a delayed wage increase.

However, one case found that the City of Buffalo was able to impose a wage freeze when it was undeniable that Buffalo was in a fiscal emergency and that the wage freeze was a last resort after looking at other options.

In discussing the matters with others here, we expect that Connecticut and other states will continue to look for creative options to address their financial situations with employees.

However, it is doubtful that these options will involve changes to existing contracts without negotiation with the unions involved.  In addition, any State attempts to change contracts in the private sector would be almost certain to fail.

capitoldasThe Connecticut General Assembly is back in session and with significant budget deficits looming, it’s not going to be an easy year for legislators.

From a labor and employment law session, once again it will be interesting to see what will be seriously considered.

A Bloomberg Law article late last week suggested that Democrats in several states, including Connecticut, are planning bills to try to replicate the federal overtime-pay overhaul that has been held up in federal court.   Without citing names, the article states:

Democrats in Rhode Island, Connecticut, Maryland, Wisconsin and Michigan said they plan to introduce bills modeled on Obama’s reform, which would have made millions more white-collar workers eligible for overtime.

A cursory look at the Bill Record book for the Labor & Public Employees committee fails to show such a bill yet, but it’s still early. At this point in the legislative cycle, only early “proposed” bills are officially on record. That, of course, doesn’t mean that other draft bills aren’t being floated out there.

So among the proposed bills, what else is out there being considered for 2017?

  • As expected, a paid family & medical leave bill is definitely on the table now, after being looked at for the last 18 months or so.  Indeed, it is titled “Proposed Senate Bill No. 1″ and is co-sponsored by several senators.  Having a bill marked as “One” indicates that this will be a priority in the current session.  The details, however, are still being worked on.
  • Another bill that already has garnered widespread support including from the House leadership is Proposed House Bill 5591.   While again, the details are still forthcoming, the bill would “require employers, including the state and political subdivisions, to provide equal pay to employees in the same workplace who perform comparable duties.”  What’s still unknown is why this is being sought, just 2 years after another pay equity bill titled “An Act on Pay Equity and Fairness” was passed. Time will tell, but expect to see more on this bill soon.
  • Another bill concerning “Various Pay Equity and Fairness Matters” (not to be confused with prior bills) has also been proposed by new Representative Derek Slap from West Hartford.  That bill would mirror some other states that have recently passed bills further limiting what prospective employers can ask applicants. Specifically, this Proposed House Bill 5210 would:

(1) Prohibit employers from asking a prospective employee’s wage and salary history before an employment offer with compensation has been negotiated, provided prospective employees may volunteer information on their wage and salary history,

(2) Prohibit employers from using an employee’s previous wage or salary history as a defense in an equal pay lawsuit,

(3) Permit an employer to have an affirmative defense in an equal pay lawsuit if it can demonstrate that, within three years prior to commencement of the lawsuit, the employer completed a good faith self-evaluation of its pay practices and can demonstrate that reasonable progress has been made towards eliminating gender-based wage differentials, and

(4) Protect seniority pay differentials from adverse adjustments for time spent on leave due to pregnancy-related conditions or protected parental, family and medical leave.

Other proposed bills can be found here including an increase in the minimum wage to $15 per hour.

One important note: The state Senate has now split 18-18 among Democrats and Republicans.  Thus, I think it’s fair to expect that there will be less laws that impact employers than in year’s past.  The CBIA has an update from a business perspective here.

In the course of my litigation cases, I’ve had a good-natured argument at times with a few counsel who represent employees about the mindset of employers.  The argument I’ve heard from them is that employers are too cavalier in firing employees and just go about hiring someone else (someone younger, they argue).

headahbBut what I’ve heard from my clients over the years is something different.

Typically, the decision to fire an employee is tough, made only after a series of internal conversations.  Employees with performance issues weigh on the supervisor’s minds — the struggle between trying to help the employee improve while still making sure that the needs of the business get done.

Mostly they get it right. But firing a poor performer doesn’t typically solve the issues for employers. Rather, they then need to find the RIGHT person to fill that position.

Hiring the right person is hard.   Just the process of searching for that person can sometimes feel like the proverbial needle in the haystack.  Online resumes come in by the dozen and business pressures make it difficult for employers to just find the time to parse through the resumes and interview candidates.

The headaches with hiring have only gotten worse over the last decade as well.

New laws have been put in place that place restrictions on what employers can and cannot ask and when they can ask those questions. And further restrictions on things like non-compete agreements in certain professions make hiring the right person all the more important.

For example, “Ban the Box” is now the law in Connecticut. Have you amended your employment applications to address this issue? Restrictions on the use of credit reports were put in a few years ago. Have you revised your process accordingly? And how can you search social media without running afoul of laws that ban “shoulder surfing”?  Do you give employees an “offer letter” that outlines the terms of their employment as Connecticut law requires?

I’ve talked about some of these things in prior posts, but I’m going to expound upon it further at our firm’s upcoming Labor & Employment Law seminar later this month.  You can register for the program here; space is very limited at this point.

Are there other topics related to hiring that you’d like to hear addressed at the seminar or on the blog? Be sure to post a comment so we can incorporate that in our free presentation.

2016labordayWhy do we celebrate Labor Day?

And should it be celebrated on a Tuesday instead?

It’s one of those holidays that we celebrate, but my guess is that most people have no idea on the answer.  But several (many?) years ago, I touched on this on the blog and I thought it would be fun to resurrect some of those facts.

Indeed, Slate magazine had a good explainer way back in 2010 on the subject.  Turns out Grover Cleveland has a lot to do with it but its origins go back even further than that.

Though President Grover Cleveland declared Labor Day a national holiday in 1894, the occasion was first observed on Sept. 5, 1882, in New York City. A parade was organized by the city’s Central Labor Union, a branch of the Noble Order of the Knights of Labor, a secretive labor union founded in 1869 by a clique of Philadelphia tailors. Historians still debate over whom, specifically, to credit with the idea of a holiday dedicated to the workingman. Some say that Labor Day was the brainchild of Peter J. McGuire, co-founder of the American Federation of Labor. Others argue that Matthew Maguire, the CLU’s secretary, was the holiday’s mastermind and that he doesn’t receive proper credit because he ticked off the mainstream labor movement by running for vice president on the National Socialist Labor Party ticket in 1896.

According to Ted Watt’s The First Labor Day Parade, the September date was chosen because it coincided with a Knights of Labor conference in New York, thus guaranteeing a sizable turnout for the festivities. Though the event wasn’t particularly festive, at least by today’s standards: It resembled a protest far more than a parade, with CLU members required to march in support of the eight-hour workday. (Those who ditched faced fines.)

The U.S. Department of Labor’s website delves into the controversy over how the holiday started as well with this background explainer page too.

More than 100 years after the first Labor Day observance, there is still some doubt as to who first proposed the holiday for workers.

The most fascinating part to me was that it was first celebrated on a Tuesday!

But now, every year, the USDOL devotes new webpages to this day.  And it even posted a video about the work it is doing on the subject. 

And how did such a holiday then become the traditional end to the summer season? Well, I’ll leave that to the experts. But in the meantime, enjoy this list of top 10 workplace songs (plus some alternates).  And be sure to check out the comments on the post where my labor law friends post a “union-friendly” list too including “Bread and Roses”.  

GA2So last week I provided a recap of a few of the labor & employment law bills still being kicked around the legislature.  From talking with a few folks in on the process, here are some other bills to keep an eye on (whether in this original form or as an amendment to an existing bill).

  • House Bill 5367 would reform the unemployment compensation process a bit. It makes several changes to unemployment benefits and eligibility requirements for receiving them by 1) increasing from $15 to $50 the minimum amount of weekly unemployment benefits most claimants can receive; 2) increasing from $600 to $2,000 the minimum amount most claimants must earn during their base period (the first four of the last five calendar quarters) to be eligible for benefits; and, 3) requires most claimants’ benefits to be based on their average quarterly wages during all four quarters of their base period, instead of during their two highest earning quarters.  The reforms would make Connecticut more consistent with neighboring states. The CBIA has supported this bill.
  • House Bill 5237 — the so-called “ban the box” bill — is one I’ve touched on before.  It was recently referred to the Appropriations Committee. It’s being closely watched by business interests and should be a top item for employers to track.
  • House Bill 5591 would create a Connecticut Retirement Security Authority (“authority”) to establish a program for individual retirement accounts (IRAs) for eligible private-sector employees, who are automatically enrolled in the plan unless they opt out.  The bill would apply to all private sector employers that employ at least five people each of whom was paid at least $5,000 in wages in the preceding calendar year.  There is a significant administrative cost however to this bill and in light of the state’s fiscal crisis, it seems unlikely that it will be passed this year.
  • House Bill 5402 is still kicking around too.  It would greatly expand the state’s whistleblower protection laws by expanding protection to employees who (1) make reports to their supervisors or managers (either directly or through a third party) or (2) participate in the employer’s or a public body’s investigation or similar proceeding on request of a supervisor or manager or the public body. Not surprisingly, business interest groups have been opposing this bill because it greatly expands the scope of the protection and would change time deadlines as well.

Many other bills died in committee earlier this month so at least the scope of the potential changes out there is known. How much gets passed this year will depend, at least in part, on how the state can resolve its projected deficits.  Connecticut has been seen, of late, as being anti-business (see, e.g., GE) and the governor has made it clear that he’s not in favor of additional tax hikes on businesses.

So stay tuned!

generalassemblyThe 2016 Connecticut General Assembly is about one month from ending its term so it’s a good opportunity to see what bills are still floating out there.

I’ll do a bigger recap when we get close to the end of the session but if you have any interest in the bills (and, if you’re an employer, you should), you should contact your local representative as soon as possible.

  • House Bill 5261 is an interesting one and comes in response to a crackdown by the CTDOL on the employment relationship local sports leagues have with coaches and referees — namely, by saying that such leagues are responsible for unemployment compensation.  This bill exempts coaches and referees who work for private or public athletic programs, other than public school districts, from employer-employee rules for purposes of unemployment taxes and compensation.
    Under the bill, according to the Office of Legislative Research, “as of October 1, 2016 no employer-employee relationship is deemed to exist between certain operators of organized athletic activities and certain individuals employed as coaches or referees of those organized athletic activities, except such operators and individuals can mutually agree, in writing, to enter into an employer-employee relationship.”
    The bill has made it out of the Labor Committee and is still awaiting a vote out of the Finance Committee.  For more on the bill, see this recap from the CBIA.
  • Senate Bill 40 would limit the circumstances in which most employers can check the credit of job applicants and employees. But it also broadens the circumstances in which employers can require checks of people applying for or working in positions that would give them access to museum and library collections or prescription drugs and other pharmaceuticals. The bill was voted out of the General Law Committee on April 5th and should be watched carefully.
  • Senate Bill 211 is one of those bills we’ve seen before; this would allow employers to pay employees by payroll cards, instead of by check, which could help reduce the use of predatory “paycheck loans” out there.    It too has made it out of committee and is awaiting a vote on the floor.
  • Senate Bill 221 would implement a paid family and medical leave program in the state.  It’s a complex bill but considering the publicity of such efforts in other states, this is worth a close follow.   But beyond that, this bill goes much further than has been previously reported as it would expand the existing FMLA law to cover all employers of two or more employees (down from 75) and would prohibit employers from requiring employees to use any paid time off as part of their FMLA leave.  Not surprisingly, business groups like the CBIA oppose the measure while other interest groups have showed strong support.

What else is going on? I’ll have more in an upcoming post.

The first few days of the new Connecticut legislative session are, dare I say it, kind of fun from an outsider perspective. That is, if you know what you are looking at.

Why? Because it’s the time when legislators start submitting “proposed” bills. But these proposals are far from polished products. Sometimes, these proposals are done to satisfy constituents. Other times, they are submitted to get the issue discussed before a committee.

Either way, they can raise a few eyebrows.

Take Proposed Bill No. 5267. This proposal would require “the Labor Department to develop and promulgate an employers’ bill of rights”.  Why? It would “serve to protect employers from frivolous complaints and claims brought by employees.”

My friend, Jon Hyman — who actually wrote a book entitled “The Employer Bill of Rights” — ought to love this one. Unfortunately, the substance of the proposal is basically confined to the line I just mentioned. No specifics.  But here are some that Jon has suggested:

The Right to Hire on Qualifications;

The Right to Fire on Performance;

The Right to Control Operations:

Alas, I think the Connecticut proposal is the beginning and end of such an idea.

The opposite of the above proposal is Proposed Bill No. 5080. This proposal would amend state statutes to require retail stores to close on certain holidays unless it allows its employees to decline to work such holidays without penalty.  Call it the Kmart effect; Kmart opened before breakfast on Thanksgiving.

It’s still early though. These bills will be discussed at today’s legislative committee meeting.  There are lots more proposals coming down the road. Among the other items on the committee’s agency “an act concerning the use of credit histories in employment decisions” and  “an act concerning healthy workplaces”.

Pull up a chair. The next few months ought to be interesting.

 

As I take some extended time off from the office, frequent guest poster Chris Engler takes a look back at some of the earliest background on labor history.

Because I majored in history in college, I’m a firm believer that understanding history is of great benefit when planning for the future.

Early “Workers”

Autumn is in many ways a time of heritage and traditions.  With the trifecta of Columbus Day, Veterans Day, and Thanksgiving, we have numerous opportunities to step back and reflect on our predecessors and forefathers.

I have always enjoyed pondering the effects of their actions and considering where we’d be, for better or for worse, without them.

That’s a worthwhile exercise to do with employment law as well.  To better understand the current state of the law, as Dan said above, it’s helpful to know what the workplace was like in the days of old.

As fate would have it, this is also the perfect time of year for this type of reflection.

They didn’t exactly make the front page, but the anniversaries of three important milestones in the development of American labor relations recent came and went.

The late summer and early fall marked the 180th anniversary of a pair of cases involving Thompsonville Carpet Manufacturing Company, late of Enfield.  In one of the first recorded strikes in Connecticut, carpet weavers had walked off the job.

The company sued them, claiming that they were illegally interrupting the company’s business.  One of the strikers returned the favor and sued his employer on the grounds that the first lawsuit was just an attempt to get him arrested.  (Back then, civil defendants without property to cover their potential liability were often imprisoned.) 

A win for the employer in these important early cases might have crippled the nascent labor movement.

However, the jury in the first case sided with the strikers, empowering and emboldening workers in other industries.  (The second lawsuit was eventually withdrawn, presumably when the striker was released from jail.)

However, this did not end the question of the legality of strikes and unions.  That question was dealt with again by the Clayton Antitrust Act, which celebrated its centennial on October 15.

Antitrust law generally has no place on an employment blog, but the Clayton Antitrust Act had one nugget of relevance for us.

Clever employers (or clever employers’ clever lawyers) had taken to using earlier antitrust laws against striking unions by claiming that they were cartels and restricted trade.

The Clayton Act sought to put an end to this by specifically exempting unions from the act’s provisions.

Both of these developments arguably came at the expense of employers.

The third development pointed the other direction and limited the behaviors of unions.  The case was Steele v. Louisville & Nashville Railroad Co. which turns seventy in a few weeks.

In this case, the U.S. Supreme Court recognized for the first time the duty of fair representation.  This duty requires unions to be diligent and fair in representing the interests of all members of the bargaining unit.  While the case involved racial discrimination (white union members were trying to keep their African-American coworkers out of the union), the doctrine has since expanded significantly.

The merits of these three legal developments are still debated.  Regardless of one’s viewpoint, however, there can be no doubt that they have had profound impacts on American labor relations and, by extension, on society as a whole.

Just think what the workplace will look like in another 180 years.

James “Larry” Foy passed away earlier this week.  (His memorial service is scheduled for tomorrow in Southwick, Massachusetts.)

For those of us in Connecticut that were blessed with having had a case with him as an arbitrator or mediator — and there were many — his death will leave a substantial void.

Indeed, Larry was a labor arbitrator and mediator for so long that it’s hard to realize there was a time he wasn’t a fixture in Connecticut.

Here’s the telling statistic from his obituary:

Since 1979 Larry has privately arbitrated over 2,000 grievance arbitrations in the public and private sectors throughout New England. He has arbitrated over 400 municipal, teacher and state employee interest arbitration disputes. Larry has mediated over 1,000 collective bargaining contract negotiations between boards of education and bargaining units of certified teachers and/or administrators. – See more at:

So what happened in the year prior to 1979? Well, one of my partners kept documentation that.  And so, with the permission of Brian Clemow, we thought we’d relay a letter that Brian wrote about Larry way back in 1978.

Back then — when gas was just 63 cents a gallon and the Bee Gees were over the airwaves — Brian wrote a recommendation letter to the American Arbitration Association on behalf of Larry.  While he noted that as a representative of management, “Larry does not always view things in the same light as I view them”,  he suspected that union representatives would say the same thing.

Brian suggested that Larry would have a “high level of acceptability as an arbitrator in the eyes of both labor & management.”

Decades later, that prediction came to fruition time and again.  Larry became one of the area’s most well-regarded arbitrators.  I have no doubt that I speak for my colleagues and those around the state in saying that Larry will be sorely sorely missed.

Over the last few weeks, I’ve been seeing more tweets from human resources types and mainstream reporters using the phrase “wage theft”.  Two recent examples? William Tincup (who runs the popular online DriveThruHR show that I appeared on a while ago) recently tweeted:

And The New York Times labor reporter, Steven Greenhouse yesterday tweeted:

Yes, even The New York Times Editorial Board is beginning to use the term with surprising carelessness suggesting “law enforcement officials” (a term typically reserved for police officers, not Department of Labor officials) routinely use it.

It’s time for employers to beware this phrase and fight its usage because, in my view, it’s really an attempt to turn something often unintentional, into something nefarious and intentional.

Or as Mandy Patinkin’s character in The Princess Bride said: You keep using that word. I do not think it means what you think it means.

What DO I mean? Well, think of the word, “theft” and most of us think of the intentional taking of something that belongs to someone else. Like your jewelry, or your iPhone. Even your company’s trade secrets.

Continue Reading “Wage Theft”: The Trendy Phrase That May Not Mean What You Think It Means