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.

doctorContinuing my review of new employment-related bills is a measure that limits the use of non-compete agreements for doctors.

Anyone who tracks bills knows that the name on the bill sometimes doesn’t match the content. Senate Bill 351 entitled “AN ACT CONCERNING MATTERS AFFECTING PHYSICIANS AND HOSPITALS” is a good case in point.

Seems innocuous enough, right? But through various amendments and compromises, it actually contains specifics on what can or cannot be in a non-compete agreement for physicians.  (For limits in other professions, see prior posts here and here.)

In general, the bill sets up a one year and 15 mile limit for physician non-compete agreements for any agreement after July 1, 2016.

The bill does not specify what is to happen to existing agreements that may have broader restrictions; will courts find that they violate the new ‘public policy’ of Connecticut, as the attorneys at the Working Together blog suggest? That remains to be seen.

For employers that have yet to draw up agreements, arguably there is a 60-day window to do so but given that this may now become law, it might be too little too late.  (I have not heard whether the governor intends to veto this measure.)

For existing agreements, it appears that the review will attempt to mirror common law with three standards (note that the term “covenant not to compete” is actually defined as being applicable only to physicians).  These standards are:

A covenant not to compete is valid and enforceable only if it is: (A) Necessary to protect a legitimate business interest; (B) reasonably limited in time, geographic scope and practice restrictions as necessary to protect such business interest; and (C) otherwise consistent with the law and public policy.

The bill goes on to state that:

A covenant not to compete that is entered into, amended, extended or renewed on or after July 1, 2016, shall not: (A) Restrict the physician’s competitive activities (i) for a period of more than one year, and (ii) in a geographic region of more than fifteen miles from the primary site where such physician practices;

Simple enough, right? Well, not exactly, the agreement also shall not:

(B) be enforceable against a physician if

(i) such employment contract or agreement was not made in anticipation of, or as part of, a partnership or ownership agreement and such contract or agreement expires and is not renewed, unless, prior to such expiration, the employer makes a bona fide offer to renew the contract on the same or similar terms and conditions, or

(ii) the employment or contractual relationship is terminated by the employer, unless such employment or contractual relationship is terminated for cause.

That’s a lot of “ands” and “unlesses” if you’re keeping track at home.  But one thing I’m sure of is that a “for cause” termination allows for more flexibility.

But what is “for cause”? Can it be defined by the employer? Or is the legislature using another definition of “cause”? That, unfortunately, is a question for another day.

For now, physician groups, hospitals and other health care providers need to track signing of the measure and, if signed, review all existing agreements and form agreements for compliance with this new potential law.  The one-year/15 mile restriction should become the norm.

And if you have a strong opinion against this measure, now would be a good time to lobby the governor to veto it.

 

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.

senate2003While I normally make my year-end reflections at, well, year end, I can’t help but take this moment to see the big picture: We’re hearing an awful lot about restrictive covenants.

These covenants — often in the shape of non-compete clauses or non-solicitation (of employees or customers) clauses — have become popular because companies are looking to protect their financial interests.

Connecticut — despite its reputation for being anti-business — still has relatively strong protections for employers who want to use these clauses for their employee.

But these clauses are coming under attack more and more as their use becomes more widespread.

Jay Wolman, on The Legal Satyricon, noted that non-disparagement clauses in separation agreements may be one area where courts are reluctant to enforce. As a result, employers may want to use severability clauses to have the agreements upheld even if one provision is overbroad:

These clauses are very common, but likely are not long for this world.  In the interim, employer counsel may want to rethink the standard severability clause.  Although employers are certainly keen on obtaining as much a release as possible, it may be time to reconsider whether the agreement should survive if the former employee can simply ignore these clauses.

The ABA Journal of Labor & Employment Law also recently published an article on “Developing Trends in Non-Compete Agreements and Other Restrictive Covenants.” As the authors note, courts still tend to enforce the covenant “if it protects a legitimate business interest, the employee received consideration for the covenant, it is narrowly tailored, and the time and territorial limitations are no greater than necessary to protect the employer’s business interests.”

Despite this, the authors are quick to highlight the fact that each state interprets such things differently.

The New York Times even last year noted the trend of employers using these clauses more.  And not in a good way.

With this publicity in mind, Connecticut is again taking the lead — at least from a federal perspective.

Slate reported last week that Senator Chris Murphy introduced legislation that would ban non-compete agreements altogether for workers who make less than $15 per hour.

It would also require companies to let potential hires know ahead of time that they will be required to sign a non-compete agreement.

The bill, called the Mobility and Opportunity for Vulnerable Employees Act (MOVE) is also co-sponsored by Connecticut’s other senator, Richard Blumenthal.

At a press conference, Senator Murphy said that the bill was necessary in a free labor market.  “If workers can’t go to a competitor for a promised higher wage, then the market fluidity — the labor fluidity that creates upward pressure on wages — disappears,” Murphy said. “If workers are locked into jobs because of non-compete clauses, then there is no reason for companies to raise their wages.”

Without bi-partisan support, the odds of this bill passing are somewhere between never and no.  But don’t be surprised if we see this pop up again at a state level in the next legislative session.

A federal bill banning workplace discrimination (known as the Employment Non-Discrimination Act “ENDA) on the basis of sexual orientation cleared a key procedural hurdle last night as the Senate voted to begin debate on the measure, 61-30.   Passage by the Senate is now expected later this week.   (You can find my prior coverage of ENDA beginning here.)

It’s a significant step for sure. But the prospects for ENDA in the House of Representatives look grim. 

A spokesperson for Speaker John Boehner said the Speaker would not support the bill.  “The Speaker believes this legislation will increase frivolous litigation and cost American jobs, especially small business jobs.”

Connecticut’s experience with its own workplace ban on sexual orientation discrimination does not support the Speaker’s arguments.

According to the statistics from the Connecticut Commission on Human Rights and Opportunities, in 2009-2010 (the last readily accessible statistics) there were only 53 employment claims statewide claiming sexual orientation discrimination.  There were nearly 10 times the number of race discrimination claims that were filed over the same period. 

That’s not to say that some of those complaints aren’t frivolous. Indeed, there were several claims that same year that were readily dismissed by the CHRO without further investigation. 

But that hardly justifies allowing a company to purposely discriminate against someone because of his or her sexual orientation or gender identity.  Apple’s CEO Tim Cook nailed it in a recent op-ed in the Wall St. Journal. 

Our good friend, Jon Hyman, posted about this yesterday:

Anti-discrimination laws that exclude sexual orientation and gender identity suggest that these forms of discrimination are permissible. Additionally, while I look forward to embracing the day that all forms of discrimination cease to exist, I would not argue for the abolition of all anti-discrimination laws if that were to occur. Instead, I would argue that the laws are working, and are needed as a deterrent to maintain the status quo.

For employers in Connecticut, there will be less impact from ENDA then in many other states. But for employers that still think its ok to treat your employees differently because of their sexual orientation, your time is thankfully running short.

The Connecticut General Assembly is back at work so it’s time to take a quick peek to see what’s percolating.

2013 Legislative Session Begins

The Connecticut Business and Industry Association highlighted the “captive audience” bill as bill that is resurfacing, even though the Attorney General has previously raised doubts about the constitutionality of it.  The bill would restrict communications by the employer in general workplace meetings.  The CBIA highlighted the bill’s flaws:

The proposal usually shuts down much of what an employer can talk about with their employees in regular workplace meetings. For example, the last captive audience proposal restricted “political” discussions—with “politics” so broadly defined that almost any topic would have been considered off-limits. This would include issues critical to the effective management and operation of a business.

And under the threat of severe legal and financial penalties, an employer’s ability to communicate—particularly in opposition to the potential unionization of the workforce–would be effectively silenced.

Before this flawed concept goes any further, lawmakers should heed the attorney general’s warnings.

The Labor & Public Employee Committee at the legislature maintains a bill record bill that lists potential bills up for consideration.  As the session progresses, this list gets more refined.

Among the early “Proposed Senate Bills” under consideration:

  • Proposed Senate Bill 56, which would increase minimum wage by 75 cents in January 2014 and another 75 cents in January 2015;
  • Bills that would either eliminate or expand paid sick leave (Proposed Senate Bills 179 and 198);
  • Proposed Senate Bill 159, which would “prevent current or potential employers from requesting or requiring that employees or potential employees provide passwords to their personal accounts as a condition of their employment.”

On the House side, a few “Proposed House Bills” are starting to surface too including:

The next meeting of the Committee is set for January 29th, where these concepts — and others, including teaching about the history of the labor movement — will be discussed.  No public hearings have yet been posted publicly.

UPDATED June 9, 2011 – The House approved the measure late last night, June 8th. For additional details, see this updated post.

In the closing hours of the General Assembly’s term, the Connecticut Senate has passed a bill yesterday that would ban the use of credit reports by employers in many situations.

Senate Bill 361 passed along party lines and can be viewed here. It now goes to the House for a possible vote by the end of the term.

Will Employers Be Banned From Using Credit Score Numbers?

The bill, in its present form bans employers from requiring employees or prospective employees to consent to a request for a  report that contains information about the employee’s or prospective employee’s credit score, credit account balances, payment history, savings or checking account balances or savings or checking account numbers.

There are several exceptions, however:

  • Employers that are “financial institutions” as defined by the statute;
  • The report is otherwise required by law;
  • The employer reasonably believes that the employee has engaged in specific activity that constitutes a violation of the law related to the employee’s employment,
  • The report is substantially related to the employee’s current or potential job or the employer has a bona fide purpose for requesting or using information in the credit report that is substantially job-related and is disclosed in writing to the employee or applicant.

And what does “substantially related to the job” mean? Well, the bill also contains a definition for that as well.  According to the bill, it means that the position:

  • Is a managerial position which involves setting the direction or control of a business, division, unit or an agency of a business;
  • Involves access to customers’, employees’ or the employer’s personal or financial information other than information customarily provided in a retail transaction;
  • Involves a fiduciary responsibility to the employer, including, but not limited to, the authority to issue payments, collect debts, transfer money or enter into contracts;
  • Provides an expense account or corporate debit or credit card;
  • Provides access to (i) confidential or proprietary business information, or (ii) information, including a formula, pattern, compilation, program, device, method, technique, process or trade secrets; or
  • Involves access to the employer’s nonfinancial assets valued at two thousand five dollars or more, including, but not limited to, museum and library collections and to prescription drugs and other pharmaceuticals.

As you can see, these exceptions are numerous. Of course, what is a “managerial” position in this context? The bill is silent.

And even if an employer falls within an exception, the employers still has to comply with the Fair Credit Reporting Act.

As for the scope of the bill, all employers (those that have 1 or more employees) would be covered by this bill.  If approved by the House (and signed by the Governor), it would become effective October 1, 2011.

 

The long-discussed Paycheck Fairness Act failed to clear a key Senate hurdle today, effectively killing the prospects for the bill in this Congressional session and likely for the foreseeable future.  The Washington DC Employment Law Update has further details here.  

Long-time Congresswoman Rosa DeLauro (D-Conn, 3rd) has been a leading sponsor of the bill and she has a long and distinguished career in the House.

The bill would have amended federal law by removing many of the defenses that employers can use to justify a difference in salary between a male and female worker.  

With a Republican majority in the upcoming House session, it is unlikely that this bill will see passage anytime soon. 

Back in July, the proposed Paycheck Fairness Act, whose lead sponsor is Connecticut’s own Rep. Rosa DeLauro, was still just being tossed around. At the time, I noted that there was criticism of the statistics being used to justify the law.

Now, numerous outlets are suggesting that the bill is close to passage (here, here and here.) Jon Hyman, of the Ohio Employer’s Law Blog, has previously provided this excellent recap of the five significant changes that employers should be aware of in this bill.  They include modifications to the defenses can use, enhanced damages, new non-retaliation provisions, changes from an opt-in to an opt-out class action status, and new reporting obligations. 

The topic is one that is of interest to our current Connecticut senators. In March 2010, Sen. Dodd held a hearing on the subject here.  For more background, you can see all of my posts related to the subject here. 

In the meantime, employers should keep tabs on this new legislative initiative.

The Capitol Watch blog is reporting this Thursday evening that the proponents of the Paid Sick Leave bill (H.B. 6187) are still one vote shy of passage in the state Senate:

The latest vote count shows the measure tied at 18 to 18 in the 36-member Senate. Eight Democrats are currently opposed to the bill, while two Republicans are in favor.

"We’re one vote short,” said Sen. Edith Prague, a longtime labor supporter. "Those eight [Democrats] are pretty firm. All we need is one vote.” ….

Lobbyists for CBIA, the state’s largest business organization, have been working the hallways on a constant basis as the clock ticks toward the end of the session. 

With its passage still in question at least for another 24 hours and with multiple amendments proposed, I’m going to hold off on a full recap of the measure until we get a better idea of what the bill is going to pass and in what form.

Until then, I’ll leave you with the Office Of Legislative Reports recap which states that the bill would be effective January 1, 2010 if passed and approved by the governor:

This bill requires most employers with 50 or more employees in the state to provide their employees with paid sick leave once the employee has worked 1,040 hours. Paid sick leave accrues at a rate of one hour for each 40 hours worked after the employee has worked 520 hours in 12 months. Current law does not require employers to provide sick leave, whether paid or unpaid.

Employees may accrue up to 32 hours of sick leave in 2010 [4 days] and up to 40 hours a year [5 days] in each following year. The leave can be used for an employee’s or the employee’s child’s illness or injury, treatment of an illness or injury, diagnosis, and preventive medical care. It can also be used for reasons related to an employee who is a victim of family violence or sexual assault.

It exempts manufacturing employers that provide some form of paid leave at a rate equal to or greater than the bill requires. It includes all other private sector and public sector employers with 50 or more persons. It deems an employer to be in compliance with its requirements if the employer offers paid leave that can be used for the same purposes and in the same conditions. …

*House Amendment “A” (1) changes the required number of hours an employee must work to be eligible for paid sick leave, (2) reduces the number of paid sick leave hours that can be accrued and used, (3) exempts employees under age 18 from its provisions, (4) exempts manufacturers that provide some form of paid leave at a rate equal to or greater than the bill requires, and (5) specifies it does not prohibit an employer from allowing employees to donate accrued sick leave to another employee.