So, a couple of months back, I talked about how separation agreements for small employers might not be covered by the federal law that covers such agreements.

After all, since the Age Discrimination in Employment Act only applied to employers that have 20 or more employees, the requirements for a “knowing and voluntary waiver” of claims under separation agreements only applied to those larger employers.

Because this is a federal law, it applies in Connecticut though states are free to craft additional laws if they wish.

Recently, though, I’ve heard of an employee spouting off about “advice” he received that  Connecticut state law had the same requirements as federal law did.

And since Connecticut’s anti-discrimination laws apply to employers of 3 or more employees, the employee argued that he should be provided with 21 days to consider the agreement.

When I heard this, I scratched my, well, proverbial head about this one.  Did I miss something?

The short answer is no, I didn’t miss something.  Connecticut law doesn’t say this.  You can see for yourself in Conn. Gen. Stat. 46a-60.

But how did the employee get such advice?

The first answer may be the simplest one: The attorney he spoke with doesn’t routinely practice in the area.  Sometimes, well-meaning lawyers just overstep their knowledge basis.

Another obvious answer is that the employee’s so-called advice was from “Attorney” Google.  Google is really good at finding things that might apply to your situation — not as good yet at telling you whether it actually applies to your situation.

And if you Google a topic like this, you might actually find a state court decision that looks — at first blush — like it might be on point.

State courts often use the following language in their decisions:

Although this case is based solely on Connecticut law, we review federal precedent concerning employment discrimination for guidance in enforcing our own antidiscrimination statutes.

What does THAT mean?

Typically for the same types of disparate treatment claims for, say, gender discrimination claims, courts in Connecticut don’t have as much as experience as federal law. So where the law is the SAME, it makes sense to look to federal laws that are similar.

The problem in the age discrimination statute context is that Connecticut law is DIFFERENT than federal law at times. There is no state equivalent. So looking to federal law makes no sense whatsoever.  And sure enough a quick search of Google Scholar reveals NO state law case applying that federal law to a review of separation agreements.

So how ARE separation agreements to be reviewed in Connecticut? In essence, you would most likely look at the agreement under state laws dealing with contracts.  Typically, this is also done through the “common law’ – that is precedent from the courts.  And Connecticut courts haven’t said much about separation agreements.

Employers are sometimes caught in the middle of receiving advice from their counsel (hopefully correct) and what the employee believes is true whether through an attorney or otherwise.  Employers should understand the misinformation that exists out there and, when confronted with these issues, try to explain them to employees.

Otherwise, a seemingly innocuous situation could turn much more stressful when the employee thinks (and worse, is being told) that the employer is violating a non-existent state law.

ashleymendoza1eckertToday, I’m delighted to bring you what I hope will be the first of several updates for employers from the immigration law perspective.  One of my newest colleagues, Ashley Mendoza, along with my law partner Brenda Eckert, have been tracking some of the newest rules for employers coming out of the Department of Homeland Security.  These rules will have a particular impact to employers who recruit from the STEM (science, technology, engineering, and math) areas.  For employers that rely on foreign workers to help supplement their ranks, this is crucial to understand.

But a cautionary note: It’s a bit technical. There’s really no way around that. Immigration laws are just filled with technical requirements. Indeed, that’s one reason why a qualified immigration lawyer is often needed to help employers navigate these rules. Brenda and Ashley are leading the way here at my firm and I thank them for this detailed update.

Yesterday (May 10, 2016), the U.S. Department of Homeland Security (“DHS”) implemented major modifications to Optional Practical Training (“OPT”) extensions for students on F-1 visas enrolled in science, technology, engineering, and mathematics (“STEM”) degree programs.

IMG_7083The new regulations, published at 8 CFR Parts 214.2(f) and 274a, authorize a 24-month STEM OPT extension period, replacing the previous 17-month STEM OPT extension period.

While at first glance, the new STEM OPT extension regulations may seem a cause for celebration, there are a number of added requirements and oversight provisions and, for some U.S. employers, the benefits may not outweigh the burdens.

What is OPT?

OPT is a form of temporary employment available to students holding F-1 visas that directly relates to a student’s program of study. The employment is often paid, and may take place during and/or after completion of the degree program.

The overarching idea is that OPT will afford eligible international students and new graduates the opportunity to gain hands-on practical experience to supplement what they learned during their degree program. Students may be authorized for a total of 12 months of full-time OPT at each educational level (e.g., undergraduate, graduate and post-graduate).

The application process is relatively straight forward. The student must first request approval from his or her designated school official (“DSO”), who will then make a recommendation to the electronic Student and Exchange Visitor and Information System (“SEVIS”) by endorsing a Form I-20.

Thereafter, the student must file the Form I-765, Application for Employment Authorization, supporting documentation, and a filing fee of $380.00 with the U.S. Citizenship and Immigration Services (“USCIS”).

The extension & the changes to it

Since 2008, eligible students who graduate with a qualified STEM degree and are presently engaged in a period of approved post-completion OPT may have the option to extend their OPT for a period of 17 months.

This is the existing STEM OPT extension, and this is what the new regulations modify. These changes will affect all parties involved in the STEM OPT extension process. This includes the students and the U.S. employers with whom the students will train during the course of the approved period of STEM OPT.

Not to be forgotten, however, are the DSO’s who perform pivotal work with students behind-the-scenes to recommend them for OPT and extensions and maintain student records in SEVIS.

So, what’s new?

The better question, really, is what isn’t new.

The new regulations provide a comprehensive overhaul to the STEM OPT program.

Continue Reading Major Modifications to Immigration Programs May Cause Major Headaches

GA2It’s been a long-time coming but the General Assembly finally approved of a measure that would allow employers to pay employees on a bi-weekly basis without receiving prior CTDOL approval.

The provision, part of a set of “technical” revisions to various Department of Labor matters, is long overdue.

Several employers had moved to a bi-weekly payroll scheme without realizing that they needed approval from the CTDOL beforehand.  That approval won’t be required anymore (assuming this bill is approved by the governor).

I’ve previously discussed the requirement so now employers who have been wary about seeking such approval, can just move ahead on their own.

Senate Bill 220 also makes lots of technical changes to the unemployment compensation scheme and even to drug testing (getting rid of the suggesting that the DOL develop some regulations in this area).  These probably won’t be of interest to most employers, but it’s worth a look through the bill summary to see if something else touches on your industry.

The measure will become effective when the Governor signs the overall bill.  (Other provisions in the bill go into effect October 1, 2016.)

While the temperature hasn’t felt like summer in Connecticut the last few days, judging by the traffic this morning, there are lots of you on vacation this week.

If you’re one of the (un)lucky ones working this week, perhaps you have a few extra minutes to tackle some projects that have been on the back burner.

In the human resources and employment law arena, here are a few easy steps you can take this week to get yourself into compliance with some easy-to-miss employment laws.

1.  Apply for a Waiver of Weekly Pay Requirement

Connecticut requires that all employees be paid on a weekly basis.  Employers can pay employees on a bi-weekly (or sometimes, semi-monthly) basis only upon receiving approval from the Connecticut Department of Labor.  How so? According to the CTDOL:

A letter or completed request form found on our website should be sent to the Director of Wage and Workplace Standards Division describing the reason for the change and desired frequency. Most employers request a biweekly payroll for hourly employees covered by overtime requirements. A 30‐day notice is required to all affected employees.

Action: Fill out that form (or write the letter) today using this link.

2. Set up Sexual Harassment Prevention Training

Connecticut requires all employers of 50 or more employees, to provide ” two hours of training and education to all new supervisory employees of employees in the State of Connecticut within six months of their assumption of a supervisory position.”

What that really means is that most employers should be running sexual harassment prevention training for supervisors twice a year.  In reality, some employers just forget or try to wait until there’s a critical mass.

Action: Contact a provider of sexual harassment prevention training.  The CBIA offers such training on a regular basis and so does my firm, Shipman & Goodwin.  I’ll be doing one on October 2, 2014. I’d love to see you there. 

3. Make Sure Your Payroll Records are Kept Onsite … Or Seek a Waiver

Another overlooked law is the one requiring that employers keep the payroll records at the place of employment. For employers with multi-state locations, this can be a challenge.  As Connecticut states:

Under section 31‐66 of the Connecticut General Statutes, the employer shall maintain for 3 years at the place of employment a record of hours worked and wages paid to each employee. The employer can submit a request through our website or by letter to the Division and permission may be granted to keep records at another location. Out of state businesses may receive permission if the records call [Editor’s Note: “Can?”] be made available within 72 hours.

Fortunately, the Connecticut Department of Labor has a waiver form that can be easily filled out online here.

Action: Check to see where your payroll records are kept. If necessary, seek a waiver from Connecticut Department of Labor.

Just because it’s the Dog Days of Summer doesn’t mean you can’t get anything done. Get to it.

It’s hard to read the Connecticut Law Tribune’s Editorial this week on “The Problem of Workplace Arbitration Clauses” with a straight face. It is dripping with sarcasm, filled with sweeping generalities, and reserves its greatest enmity for employers and the lawyers that represent them.

If the editorial is to be believed, employers and their lawyers apparently routinely use “deceptive” arbitration clauses — often pushed by a “third assistant personnel clerk” — that are hidden until “defense counsel raises the jury waiver or arbitration agreement from its dusty grave in the company’s personnel files.”

But perhaps I’m overreacting. So let’s review the editorial more closely and try to separate fact from fiction.  The editorial, in its full unedited version, is in italics. 

Over the last decade, employers have more and more often incorporated jury waiver or mandatory arbitration clauses into their employment arrangements to avoid the perceived horror of facing jury review of the way they treat their employees. These clauses are often presented in circumstances that many argue are deceptive, if not downright coercive.

On the first premise — that employers are using arbitration agreements more — the editorial doesn’t provide numbers. But I’ll tend to agree with the notion that the use of arbitration agreements are increasing. However, most employers are not concerned with “jury review.”  Just a handful of cases ever see a court room. Only 2.9 percent of federal employment cases even reach trial! The reasons for their use are complicated but part of it is that the cost of defending cases has skyrocketed. Indeed, from 2010 to 2013, the median time from filing to trial of a civil case in federal court in Connecticut has risen from 27.9 months to 35.7 months (nearly three years!).  Arbitration is much quicker and more cost effective for both sides.

As to the second premise — that the clauses are presented in circumstances that are “coercive” — I suppose that is up for debate. But it depends on your definition of “coercion”.  The legal definition of coercion typically means through “force” or “duress”.  The classic law school example of being forced to sign a contract at gunpoint is clearly “coercion.”  But an employee who wants a job and signs an agreement if he wants the job? In my view (and many courts), that is not “coercion.”

But let’s agree to disagree on this point and move on.

Despite the significance of an employee signing away a legal right that lies at the very base of our civil justice system, there is almost never any effort to explain to the employee what the waiver or arbitration agreement means or even that they are giving up any right at all. In fact, quite the reverse is the rule.

“Almost never”?  That statement barely deserves any credence.  There is no evidence to support this statement.  And additionally, what does it mean to “explain to the employee what the waiver” means? Typically, the provisions state that any claim out of an employee’s employment must be submitted to arbitration instead of the courts. Isn’t that enough? (Yes, say the courts.)

Regardless, employers have been advised to make sure that arbitration agreements are highlighted and not merely stuck in page 32 of a handbook.

And the editorial seems to ignore the positive attributes that alternative dispute resolution can bring to the employee as well.  Arbitration has a place in our “civil justice system” too.  (Indeed, in a 2012 editorial, the Law Tribune voiced its support for passage of the Uniform Arbitration Act. The drafters of that act noted that “the enforceability of arbitration agreements cannot be treated any differently from the enforcement of contracts generally under state contract law” and avoided specific references to employment agreements.)

Continue Reading Law Tribune’s Editorial on “Downright Coercive” Employment Arbitration Clauses Is Off-Base

Sure, the headline is click-bait. Designed to get your attention.

But it’s actually true.  Connecticut law requires employers in Connecticut to pay their employees on a weekly basis.  Conn. Gen. Stat. Sec. 31-71b states it in sorta plain English.

[E]ach employer … shall pay weekly all moneys due each employee on a regular pay day, designated in advance by the employer …

And the law goes further pay specifying that the pay day can’t be too far in advance:

The end of the pay period for which payment is made on a regular pay day shall be not more than eight days before such regular pay day, provided, if such regular pay day falls on a nonwork day, payment shall be made on the preceding work day.

So, is that it? The end of the story.

Fortunately, no. The Connecticut Department of Labor routinely grants waivers of the weekly pay requirement at least to go to bi-weekly pay.   In Conn. Gen. Stat. 31-71i, it states:

The commissioner may, upon application, waive the provisions of section 31-71b with respect to any particular week or weeks, and may also, upon application, permit any employer subject to the provisions of this section to establish regular payday less frequently than weekly, provided each employee affected shall be paid in full at least once in each calendar month on a regularly established schedule.

How does an employer do this? If you are seeking a waiver to pay bi-weekly (26 times a year), then you can fill out a form online here.

Semi-monthly pay and monthly pay waivers are less common and employers need increasingly important reasons to go to such a system.  Employers who wish to do so, can send a letter to the Connecticut Department of Labor to do so.

Employers who fail to get a waiver do open themselves up to significant fines. While the Connecticut DOL seeks compliance in this area more than penalties, it’s not a risk that employers need to take.

If you need help filing out the form, talk to your local counsel.

Last week, a story caught my eye and the attention of some of my colleagues.  As reported first by Bloomberg BNA, IBM has stopped providing the comparison information that is typically required in separation agreements for older workers under the Older Workers Benefit Protection Act.

You may be wondering how that is possible.  Robin Shea, of Employment & Labor Insider beat me to the punch with a very good recap that I don’t think I can improve upon.  So I’ll cite two paragraphs below:

As you know, when an employer has a “group termination” — usually, a reduction in force, but a “group” can be as few as two people – it is required to disclose the job titles and ages of the individuals in the “decisional unit,” which means the working unit from which the decisions were made. If the employer doesn’t make the disclosures (and get ‘em right), then it can’t get a valid waiver of age discrimination claims under the federal Age Discrimination in Employment Act although the waiver may be valid in other respects …..

But how can IBM do this?  They aren’t requiring employees to give up their age discrimination claims, that’s how. They’re just requiring them to use arbitration instead of the court system. Which I think is legal, based on Gilmer v. Interstate/Johnson Lane, a Supreme Court decision from the 1990′s.

In essence, IBM is using a separation agreement with two sets of rules: For all claims except age discrimination, employees must release IBM. For age discrimination claims, IBM has said that employees do not have to release IBM but must take any such claims to arbitration.

Will it work? That remains to be seen. It has yet to be challenged in court or the EEOC.

But most employers are not IBM and do not have the resources to take this strategy.

So I suspect that many employers will simply follow the path of least resistance and provide the comparison information under the OWBPA.  If done right, then employers will get the benefit of an additional release without the hassle of arbitration or the added cost.   It’s worked for many employers for over 20 years and, IBM’s strategy notwithstanding, it’s probably not worth changing gears now.

There are many good free resources for additional background on this topic. One that I would suggest was produced by the ABA in 2008 and is still highly relevant today.

If you’re like most employers that do background checks, you probably haven’t thought twice about the documentation you use for it.

Perhaps you’ve copied some standard language you’ve found off the Internet (not that there is anything necessarily wrong with that), or maybe you’ve just used a form that has been handed down from one HR person to another.

A new lawsuit and a new strategic focus by the Federal Trade Commission and Equal Employment Opportunity Commission should give most employers pause on the forms that they use for background checks and the background check process itself.  This is true not only for the printed forms, but also the online forms that employers have started to use with regularity.

First off, Whole Foods was recently sued by an applicant who charged that the company’s online form seeking job applicants’ approval for criminal background check violates the Fair Credit Reporting Act.

As noted by Judy Greenwald from Business Insurance:

According to the lawsuit filed Friday in U.S. District Court in Oakland, Calif., in Esayas Gezahegne v. Whole Foods Market California Inc., the language in the authorization includes a waiver of claims against those who obtain a consumer reports, in violation of the FCRA. Consumer reports include criminal background checks, credit checks and other similar reports.  …

The online authorization forms all contained language releasing those who obtained the consumer reports from all liability, in violation of the FCRA’ s requirement that the authorizations be pristine documents that contain nothing other than the required disclosures and the requested authorization. In other words, defendant’s authorization forms were facially invalid,” the lawsuit states.

While it’s still early to draw conclusions from the lawsuit itself, the takeaway is that employers should consider having their disclosure contain only the disclosure.  Adding release language to it may be troubling to some courts.

I’ve discussed this in more detail in a client alert that we recently issued.

Second, this week the Federal Trade Commission and the EEOC released new guidance this week on employment background checks that again highlight the renewed focus these agencies have placed on the topic.

The press release states:

Hiring decisions are among the most important choices for any employer, but the process can be complex. For the first time, the Federal Trade Commission (FTC) and the Equal Employment Opportunity Commission (EEOC) have co-published two short guides on employment background checks that explain the rights and responsibilities of the people on both sides of the desk.

The FTC and the EEOC want employers to know that they need written permission from job applicants before getting background reports about them from a company in the business of compiling background information. Employers also should know that it’s illegal to discriminate based on a person’s race, national origin, sex, religion, disability, or age (40 or older) when requesting or using background information for employment.

At the same time, the agencies want job applicants to know that it’s not illegal for potential employers to ask someone about their background as long as the employer does not unlawfully discriminate. Job applicants also should know that if they’ve been turned down for a job or denied a promotion based on information in a background report, they have a right to review the report for accuracy.

With agencies and attorneys looking more closely at background checks, now is the right time to double check the forms you use — particularly if you haven’t looked at them in a while.

Giving claims a final resting place

A few days ago, I came across a thoughtful post from Work Matters, a longtime blog run by Michael Maslanka.

In it, Mike describes a clause in a settlement agreement to get around an issue that sometimes arises — how do you minimize the threat of an EEOC claim when the EEOC has taken the position that an employee cannot agree to a provision in which he or she agrees to not file a charge at the EEOC?

Mike solution is one that we often use too — a clause that limits the employee’s right to any recovery if he or she files a claim with the EEOC.  If you’re curious on the specific language, visit Mike’s blog post.

But Mike’s post got me thinking about other settlement provisions that pop up from time to time.   Of course, I wrote a bit about it back in 2011 so I’m not going to repeat what I said then; it’s a good place to start if you’re thinking about the subject.

Nor will I repeat the wisdom I’ve seen from one of the better articles I’ve seen about settlement provisions from attorney Robert Fitzpatrick.  I cited it (briefly) all the way back in 2008 and that I’ve cited from time to time. Robert’s article on settlement agreements was written ten years ago so it’s missing things like dealing with Section 409A, but the overwhelming majority of the article stands the test of time.  At over 90 pages, it pretty much covers the provisions you’ll need to consider including non-disparagement clauses, no-rehire provisions, and the like.

Indeed, in this age of shared information, employers need not draft an agreement from scratch. For employers, there are publicly available examples of settlement and severance agreements on the Internet.  For example, want to see the severance agreement that Marissa Mayer and Yahoo! have agreed to? It’s publicly posted.

Of course, employers shouldn’t just copy these.  It’s vitally important to get experienced employment law counsel to review your standard agreement (and specific ones, if possible).  Why should employers do this (besides a self-serving reminder to hire attorneys like myself)?

Because there are so many tricky little provisions that it’s easy to get tripped up.  Take “tender back” provisions (requiring employees to pay back settlement proceeds in the event of a lawsuit challenging the validity of the agreement).  They were generally struck down by the EEOC years ago. But your form may still have them, thereby putting your company at risk.

And if your eyes glazed over at my mention of Section 409A provisions before (and wondered what they were), that alone provides yet another reason.

Reaching an agreement with a former employee to resolve a claim of discrimination is difficult enough without worrying about whether your written agreement is valid.  Make sure you’ve covered yourself so that when you resolve the matter — it’s actually resolved.

Settlement provisions aren’t that complicated, but when reaching finality in claims, it’s better to cover your bases than cut corners.

 

In a 2-1 decision, the U.S. Court of Appeals for the Fifth Circuit (which does not include Connecticut) held on Tuesday that the NLRB erred in disallowing an employer’s mandatory arbitration agreement that waived the rights of employees to participate in class actions.

The decision in D.R. Horton v. NLRB (download here from Bloomberg Law) has long been anticipated by employers.  Indeed, when I wrote about the NLRB’s original decision in January 2012, I cautioned employers not to rip up their mandatory arbitration agreements just yet.

While the decision doesn’t directly impact employers in Connecticut, the decision is important because it removes an argument that the NLRB has been using for the last few years. Indeed, the Second Circuit (which covers Connecticut and New York) recently affirmed the right to use mandatory arbitration agreements with class action waivers as well.

The decision in D.R. Horton boiled down to whether the Federal Arbitration Act was given the “proper weight”. The Fifth Circuit concluded that the National Labor Relations Act “should not be understood to contain a congressional command overriding the application of the FAA”.

Without a split in the circuits on this issue, it is quite possible that this is the last of this issue for some time. Employers who are looking to reduce risk ought to get advice from their legal counsel about whether mandatory arbitration agreements may be right for their business.

Indeed, the court did find that the arbitration agreement here could be understood by employees to preclude them from bringing unfair labor practice claims to the NLRB and upheld the NLRB’s order to the employer that the document be revised. So caution is still strongly encouraged before implementing such arrangements.