Employment Law Update – 2017 and Beyond The New England Alliance January 12, 2017

Employment Law Update – 2017 and Beyond. 1. Massachusetts Pay Equity Law 2. Marijuana Legislation in New England and its Effects on the Workplace. 3. The New World Order – Do Unions Still Have a Voice in a Trump Presidency?

Massachusetts Pay Equity Law The MA Equal Pay Act prohibits all employers from paying one employee less than another employee of the opposite gender for comparable work. On August 1, 2016, Massachusetts enacted new pay equity legislation to expand the existing MA Equal Pay Act. Effective July 1, 2018

Major Changes In New Pay Equity Legislation Four Major Changes: Defining “comparable work.” Protecting employees’ rights to inquire about, discuss, and disclose salary information. Barring employers from seeking information about applicants’ compensation history before making an offer of employment. Creating an employer “self-evaluation” defense to pay discrimination suits.

“Comparable Work” “Work that is substantially similar in that it requires substantially similar skill, effort and responsibility and is performed under similar working conditions.” Employers cannot rely on job title or job descriptions to determine whether work is “comparable.” Certain variations are permissible: Seniority, merit system, earnings based on quality of production, sales or revenue, geographic location, education/training/experience, travel.

Inquiries and Communications Regarding Compensation Employers may not ask job applicants (or their current/former employer) about compensation history before making an offer of employment that includes compensation. Employers may not prohibit employees from asking about, talking about, or disclosing information about their compensation. Limitations: Employers are not required to disclose any employee’s compensation information to another employee or to any third party.

The “Self-Evaluation” Defense Good faith evaluation of pay practices. Must demonstrate reasonable progress toward eliminating gender-based compensation differentials for comparable work. Must be reasonable in detail and scope in light of the employer’s size. Must be completed within the three years before the alleged violation.

The “Self-Evaluation” Defense (cont’d) Self-evaluations and plans for correcting gender-based pay disparity cannot be used: To prove a violation occurred before the self-evaluation completed. To prove a violation occurred within six months following the evaluation’s completion. To prove a violation occurred within two years following the evaluation’s completion, if the employer can show that it developed and was in the process of implementing a remedial plan.

Other Key Provisions Enforcement Damages Limitations Period No Retaliation No Pay Reductions

Next Steps for Employers Review and update job applications to ensure they do not seek information concerning compensation history. Review and update interview notes, guidance and training materials for all parties engaged in the pre-offer hiring process (e.g., recruiters, HR, interviewers). Conduct new training to ensure all parties involved in recruiting and interviewing are aware of the new law’s requirements.

Next Steps for Employers (cont’d) Review and update company policies that prohibit employees from inquiring about or discussing compensation with co-workers. Consider creating a new or more robust company policy concerning equal pay. Be prepared to work with legal counsel on a self-evaluation to identify gender-based pay disparity.

Marijuana Legislation in New England November 2016: MA and ME voted to legalize marijuana. VT, NH, CT, and RI all allow for medicinal use of marijuana (in addition to MA and ME). Massachusetts: Individuals 21 and older may possess, use, purchase, and manufacture up to one ounce of marijuana. Marijuana use is prohibited in public places and anywhere smoking is banned. Does not require an employer to permit or accommodate employees’ use or possession of marijuana and does not affect employers’ ability to enact and enforce workplace policies restricting the consumption of marijuana by employees.

Marijuana Legislation in New England Maine: Effective January 30, 2017, individuals 21 and older may possess and use up to 2.5 ounces of marijuana. Employers are not required to allow or accommodate the consumption, use or possession of marijuana in the workplace. Employers may adopt and enforce policies restricting use of marijuana by employees and may discipline employees who are under the influence of marijuana in the workplace. Employers may not refuse to employ an individual 21 or older solely because of that employee’s consumption of marijuana outside the employer’s property.

Legalized Marijuana and Workplace Policies and Practices MA and ME: employers may continue to institute drug-free workplace policies. Employee use of marijuana outside of work. ME forbids employers from refusing to hire an employee solely because of the employee’s consumption of marijuana outside the employer’s property. Employers should consider whether drug testing applicants for employment is necessary and consistent with business necessity. Rejecting an applicant over marijuana use detected in pre-employment drug test could lead to liability. MA statute is silent. Prohibiting use of marijuana outside of work could potentially create liability based on discrimination laws, privacy laws, etc. Drug testing: consider using marijuana drug testing sparingly. “Reasonable suspicion” testing. Apply policies consistently to similarly-situated employees.

Medical Marijuana and “Reasonable Accommodations” Under the ADA, “a qualified individual with a disability shall not include any employee or applicant who is currently engaging in the illegal use of drugs, when the covered entity acts on the basis of such use.” Marijuana is still a banned substance under the federal Controlled Substances Act – use of marijuana is not a reasonable accommodation under ADA. State anti-discrimination and medicinal marijuana laws may require employers to tolerate use of medicinal marijuana as a reasonable accommodation. E.g., Medical marijuana laws in all N.E. states (except VT) explicitly state that employers do not need to allow employees to use medical marijuana on-site, but there is little guidance on whether allowing the employee to use medical marijuana off-site would be a reasonable accommodation.

Do Unions Still Have a Voice in a Trump Presidency? The New World Order Do Unions Still Have a Voice in a Trump Presidency?

Background Change of political party in power can have dramatic impact on traditional labor law matters. Certain doctrines have flipped 2 or 3 times over a 40 year period. Under Obama – progressive agenda had NLRB seeking to expand the scope of its jurisdiction, especially in the context of non-union employers.

Current Makeup of NLRB 3 Board Members: Gaston Pearce (D) – August 2018 Lauren McFerran (D) – December 2019 Philip A. Miscimarra (R) – December 2017 5 year terms with consent of Senate. Early years of Obama administration – did not have a quorum; appointments held up at Senate. Unlikely to be an issue for Trump, given the current makeup of the Senate.

Dialing back on the issuance of General Counsel memoranda. Initial Expectations of Trump-Constituted National Labor Relations Board Dialing back on the issuance of General Counsel memoranda. Don’t expect any reports on connection between social media and potential impact on Section 7 protected, concerted activities. NLRB enforcement – lower budget, fewer resources for investigations and enforcement actions (such as 10(j) injunctions).

What About Implications for the Joint Employer Doctrine? Major Impact Franchisor/franchisees Employers and staffing firms Private equity firms and portfolio companies Browning-Ferris Industries decision by NLRB on August 27, 2015. On appeal at U.S. Court of Appeals – DC Circuit. Employer that used staffing agency

Old Standard Joint Employer Standard: whether employers share or co-determine those matters governing essential terms and conditions of employment. Right to hire or fire workers. Set wage rates. Set working conditions and working hours. Approve overtime. Manner and method of work performance. Old NLRB cases – would look to see if not only authority to control employees’ terms and conditions of employment, but also exercise that authority directly and in more than a limited manner.

New Standard Board overruled four earlier NLRB decisions. Right to control test – possession of authority to control terms and conditions of employment. No question that this was expansion of joint employer doctrine and would have major ramifications. If DC Court enforces NLRB order, fully expect writ of certiorari to U.S. Supreme Court.

Pending Joint Employer Litigation NLRB is also litigating joint employer doctrine right now against McDonald’s. At the ALJ trial stage and still going on. Uncertain whether NLRB’s litigation stance will change mid-stream. Expect employers in franchise industry to feel emboldened by Trump presidency.