I have this running joke with my wife that anytime I’m on vacation, it seems that big employment news breaks.

And this vacation is no exception.

And it’s probably the biggest employment law news this year. Not the best time for me to have to write a blog post on my phone.  Ah well.  You all will forgive any typos.

Last night, a Texas judge issued a nationwide injunction barring implementation of the new overtime rule that was scheduled to go into effect December 1.

The judge stated:

The parties dispute the scope of the injunction. The State Plaintiffs seek to apply the injunction nationwide. Defendants contend a nationwide injunction is inappropriate. Instead, Defendants suggest the injunction should be limited to the states that showed evidence of irreparable harm. Absent contrary intent from Congress, federal courts have the power to issue injunctions in cases where they have jurisdiction. It is established that “the scope of injunctive relief is dictated by the extent of the violation established, not by the geographical extent of the plaintiff class.” A nationwide injunction is proper in this case. The Final Rule is applicable to all states. Consequently, the scope of the alleged irreparable injury extends nationwide. A nationwide injunction protects both employees and employers from being subject to different EAP exemptions based on location.

I had hinted last Friday that this was a long shot lawsuit but this year we’ve seen more than our fair share of long shots coming true (Cubs anyone?).

It’s possible that this may be appealed but that seems unlikely with a new President set to take office in less than two months.  Rather it seems more likely that the rule is now on hold…perhaps permanently.

In any event, employers that haven’t implemented the plan yet do not need to do so now. The ones that have may wish to roll back any changes (but with caution).  And talk to your local employment attorney.

I’ll have more upon my return next week.

 

I had a lot of plans this week to do another deep dive into an employment law issue but then, well, let’s just say life happens.

Among the things? Lots of questions from clients about the new overtime rules.  While everyone has had months to plan, there are definitely a few procrastinators out there.

But this may (and I emphasize and underline MAY) work out to those procrastinator’s advantage.   Reports this week are that a Texas court is considering issuing an injunction that would stop the overtime rule in its tracks.  The court has indicated that it will consider the matter by November 22nd. And moreover, even if it doesn’t issue an injunction on that date, it will consider the entirety of the case by 11:59:59p on November 30th.

While I still think the lawsuit may be a reach, it doesn’t seem as far fetched as it did a few weeks ago. Earlier this week, a similar Texas court issued a permanent injunction prohibiting the implementation of the so-called “Persuader Rule” from the NLRB.  Government overreach seems to be a theme in Texas.

What should this mean for employers? Well, I still think planning is very much in order. But if employers haven’t yet flipped the switch on their plans, they may want to hold out for a few more days to see if this Texas case leads to anything.

Why? Because once you raise an employee’s salary, for example, it’d be very hard to roll it back.

So procrastinators take heart! Maybe, just maybe, your tardiness will pay off.

But I still wouldn’t count on it.

Author’s note: I will be proverbially “going fishing” for a few days, so don’t expect any late breaking posts until after Thanksgiving here.  I’ll be posting a few “From the Archives” posts in the interim.

Readers of this blog will no doubt notice (in posts here, here, here and here, for example) that my passion for employment law is matched only by my love of the New York Yankees.  (I leave to others to debate whether that is a character flaw; Red Sox fans need not chime in, however.)

The story over the weekend regarding the suspension of Alex Rodriguez from the New York Yankees after an arbitration decision hits both of those subjects.

(The arbitrator banned Rodriguez for the 2014 baseball season. On Monday, Rodriguez applied to a federal court for a stay of the decision and to have the decision overturned.)

Baseball arbitrations are typically viewed as a model of how an arbitration proceeding is supposed to work.  It is viewed overall as fair and equitable.

And, regardless of what you think about A-Rod, it is that arbitration process and procedure that will assuredly lead to his suspension being upheld.

Lester Munson – ESPN’s legal analyst — nails the analysis in my view:

Rodriguez has zero chance of ultimate success. He and his team of lawyers and public relations specialists will make dramatic claims that the arbitration hearing was unfair and that the evidence against him was deeply flawed. But after they have concluded their fulminations, Rodriguez and his team will end up facing the fact that the decision will not be reconsidered. …

Federal courts are reluctant to review and to second-guess arbitration awards. The rationale for arbitration is that it is a fast and accurate method for resolving disputes and avoids the delays and the expense of conventional litigation. The players and the owners agreed to arbitration for disputes decades ago — in the Marvin Miller era — and the arbitration process has produced significant victories for the players over the years. When the owners attempted to set aside adverse arbitration decisions on free agency, the courts refused to reconsider arbitration rulings. Like all others in all businesses that agree in contracts to submit disputes to arbitration, Rodriguez will learn that federal judges have no interest in reconsidering rulings by arbitrators.

In other words, the rules that apply to ordinary employment arbitrations will apply here.  And arbitrations decisions are rarely overturned nowadays.

Under the Federal Arbitration Act, arbitrations can typically be overturned only if:

(1) the award “was procured by corruption, fraud, or undue means”; (2) “there was evident partiality or corruption in the arbitrators”; (3) the arbitrators engaged in misbehavior by refusing to consider material evidence, refusing without cause to postpone a hearing, or other acts that prejudiced one of the litigants; or (4) the arbitrators “exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.”

(Of course, I’m simplifying this a bit for a blog post; there are other legal theories such as “manifest disregard” that have been used to overturn arbitration awards.)

In A-Rod’s case, it’s hard to see that the arbitrator made such a big mistakes in such a heavily arbitrated matter.   (The punishment is harsh, but not so harsh that it is viewed as a “shock” to others.) The arbitrator is well versed in procedures and substance.  Even if there are errors in the decision, it will still be upheld by the courts.

So, ignore the bluster from A-Rod’s attorneys about the strength of their case; whatever they may argue publicly, the appeal of his suspension is a very long shot — longer than the longest of A-Rod’s home runs.

For employers, the case should be a reminder that if you go down the arbitration route for your employees and their employment-related disputes, don’t expect the courts to get involved.  (Jon Hyman, of the Ohio Employer’s Law Blog, is not a big fan of mandatory arbitration provisions.)

For more on arbitration provisions in the employment context, you can find some of my earlier posts here, here and here.

A new lawsuit filed last Thursday in Connecticut state court by an employer alleges that the employer’s due process rights are being violated by “inherently conflicted and irreparably unfair proceedings” at the Commission on Human Rights and Opportunities (CHRO) — the state agency responsible for investigating and enforcing the state’s anti-discrimination laws. 

In the lawsuit, NERAC v. Krich, a copy of which can be downloaded here, the employer alleges (among other things) that that the administrative law judge (a human rights referee) is a client of the presenting attorney (Commission Counsel) in a federal court lawsuit that has similiar issues to the ones that the employer is facing. 

Because of that attorney-client relationship and other due process violations, the employer alleges that the five cases it has before the ALJ must be dismissed.

There are lots of details to this lawsuit that can’t be neatly summarized in one short blog post, but several allegations jump out upon a quick review:

  • First, for those employers, that think the CHRO hearing process is quick and cheap, the lawsuit shows that the employer in this case has been dealing with allegations for over five years and many weeks’ worth of hearings in five consolidated cases.
  • Moreover, the employer sought to recuse the human rights referee (Michele Mount) on the grounds that she had applied for an associate position at the employer’s lawfirm (Jackson Lewis LLP) and was denied a position from the employer’s specific counsel (Victoria Woodin Chavey) in January 2012.   Ms. Mount denied the recusal motion, the lawsuit alleges, on the ground that “‘administrative adjudicators”‘are not required to meet the same standards of impartiality as judges.”  
  • On the date that the motion for recusal was denied, the lawsuit also alleges that Ms. Mount “had reviewed the LinkedIn profile of a senior officer of [the employer] whose alleged remarks had been the subject of a motion in limine” that had been denied.  When the employer sought to preclude reliance on information outside the evidence admitted at the hearing, the referee also denied that motion as well.
  • The lawsuit alleges that the CHRO is also pursuing an agenda of allowing attorney’s fees or emotional distress damages despite “no statutory authority to award such damages pursuant to Conn. Gen. Stat. Sec. 46a-58(a).”  It cites to the City of Shelton lawsuit that I covered back in August 2012.

The employer sought an ex-parte injunction, which was denied, but the court did schedule a hearing on the motion shortly.  The CHRO — through the attorney general’s office — has not yet filed a response and just filed an appearance in the matter on Friday.

For employers, the lawsuit should be carefully watched.  Some employers have been suspicious of whether they are able to get a “fair shake” at the CHRO and this lawsuit will certainly bolster those suspicions.  Whether a court will ultimately intervene, however, is an entirely different question that is simply impossible to answer at this early stage. 

Regardless, if employers have any hearings at the CHRO where the agency is seeking emotional distress damages on behalf of a complainant, they should continue to monitor this case and the Shelton case previously mentioned.

(Disclosure: I previously worked with the employer’s counsel, Ms. Chavey, at our former firm, Day, Berry & Howard up to 2005 or so.  I have no involvement, however, in the above proceeding.)

NERAC v. CHRO

The headlines this week have already written the obituaries for unions, at least in Michigan, where the state passed a new “right to work” law.

But here in Connecticut, unions may be weakened, but, when bolstered by the NLRB, they can still put a fight. A new federal court case in Connecticut this week handed one of the most powerful unions in the state — SEIU District 1199 — a sizable victory in the union’s battle with six local nursing homes.  You can download the Court’s decision here.  

The NLRB was quick to tout the victory in a press release:

A federal judge has ordered a Connecticut nursing home chain to offer reinstatement to approximately 600-700 workers, to rescind changes made to employee wages and benefits, and to bargain in good faith with the union that has long represented its employees.

U.S. District Judge Robert N. Chatigny granted the injunction against Healthbridge Management, LLC, at the request of the NLRB Regional Director Jonathan Kreisberg, who has authorized four complaints against the employer alleging a series of unlawful actions at six nursing homes over more than two years. The employees are represented by District 1199 of the New England Health Care Employees Union, SEIU.

The petition seeking the injunction alleged that after 19 months of bargaining, in June 2012, the company unilaterally implemented contract proposals affecting wages, hours, benefit eligibility, and retirement and health benefits without first bargaining to a good faith impasse. Employees went on an unfair labor practice strike in protest. In mid-July, the employees through their union offered to return to work under the terms of the contract that existed prior to the unilateral implementation, but the employer refused to bring them back.

The Hartford Courant has a good recap of the entire debate here as well.

For employers in the state, unions remain a force to address.  As this case shows, losing a battle could be more than just a couple of bucks.

Update: Late yesterday afternoon, the NLRB officially delayed implementation of the rule.  No new date has been set. 

The NLRB developments keep coming fast and furious.

This morning, the D.C. Circuit Court of Appeals issued a ruling essentially blocking the NRLB from going forward with its new poster requirements for employers on April 30, 2012.

You can download the decision here.

The Court noted:

The uncertainty about enforcement counsels further in favor of temporarily preserving the status quo while this court resolves all of the issues on the merits.

As a practical matter, this is likely to mean that employers across the country will not be required to comply with the posters on April 30th.  Given the schedule set forth by the court, it is now unlikely that this rule will go into effect before fall 2012. 

Stay tuned for further developments.

(H/T: Rich Meneghello who broke the news on Twitter)

This morning’s pick of Second Circuit appellate judge Sonia Sotomayor as the next U.S. Supreme Court justice is a truly momentous occasion. If confirmed, she will be the Court’s first Hispanic Supreme Court justice. 

There’s plenty of great analysis already out there this morning about the pick, including coverage by the SCOTUSBlog.  And Michael Fox is first out the gate with a recap of all the relevant labor and employment cases by Judge Sotomayor. 

Connecticut readers will no doubt recall that Judge Sotomayor was the author of a notable decision in the Ricci v. DeStefano case that is now pending at the U.S. Supreme Court. In that case, a group of firefighters contends that New Haven has discriminated against them because of their race.

But one case from 1995 stands out in my view, and not merely for my love of baseball; it was Judge Sotomayor who single-handedly ended the baseball strike.  (H/T Amanda Rykoff

On March 30, 1995, she issued the preliminary injunction against Major League Baseball, preventing MLB from unilaterally implementing a new Collective Bargaining Agreement and using replacement players, thus ending the 1994 baseball strike.  The New York Times did a interesting profile of her back then.

Her pragmatic approach in that case (and her knowledge of baseball) shouldn’t be overlooked as the confirmation hearings take place later this summer. Indeed, this is exactly the type of case that people can relate to and I expect we’ll hear a lot more about it in the weeks to come.