1. © 2009 Vedder Price P.C. The 111th Congress and the Changing Workplace: A Sampling of Pending Federal Employment Legislation Laura Sack Shareholder Vedder Price P.C. October 16, 2009

2. © 2009 Vedder Price P.C. Change is in the Air…  Change is coming to the American workplace, partially in the form of employee-friendly federal labor and employment legislation  Senior HR leaders must be knowledgeable about what is currently “in the pipeline” in Congress so they can prepare their organizations for change “Change will not come if we wait for some other person or some other time. We are the ones we’ve been waiting for. We are the change we seek.” – Barack Obama, February 5, 2008

3. © 2009 Vedder Price P.C. What Types of Labor and Employment Legislation Have Been Proposed in 2009?  Legislation Relating to Wages Paycheck Fairness Act Fair Pay Act  Legislation Relating to Labor Relations Employee Free Choice Act  Legislation Relating to Employee Rights and Discrimination Employment Non-Discrimination Act Arbitration Fairness Act Working Families Flexibility Act FOREWARN Act  Legislation Relating to Leave Healthy Families Act Family and Medical Leave Inclusion Act FMLA Enhancement Act

4. © 2009 Vedder Price P.C. Paycheck Fairness Act  Would amend the Equal Pay Act (“EPA”) portion of the FLSA by: Imposing stiffer penalties (compensatory and punitive damages) against employers who violate the EPA; Prohibiting employers from retaliating against employees who share salary information with their coworkers; and Requiring employers who make legitimate employment decisions based on “factors other than sex” to prove that those factors are “job-related” and “consistent with business necessity.”

5. © 2009 Vedder Price P.C. Fair Pay Act  Would amend the Fair Labor Standards Act (“FLSA”) to prohibit discrimination in the payment of wages based on sex, race, or national origin, and to prohibit retaliation against employees for exercising their rights under the Fair Pay Act  Would require employers to provide equal pay for jobs that are comparable in skill, effort, responsibility and working conditions  Would require public disclosure of employer job categories and their pay scales

6. © 2009 Vedder Price P.C. What Should Employers Do Now?  Examine whether their current pay practices are equitable and make sure they can explain why employees are earning what they are earning  Make sure the reasoning behind pay-related decisions is documented  Consider conducting a privileged internal compensation audit to determine whether anything about their pay practices needs to be changed  Make sure supervisors and managers are well-trained in making and documenting logical and legally defensible pay-related decisions

7. © 2009 Vedder Price P.C. Employee Free Choice Act  Three Key Provisions: Union organizing made easier Mandatory interest arbitration for first contract Increased penalties for employer violations  Union organizing made easier: Card check recognition  Effectively abolishes the right to a secret ballot election  Certification of union will be based on card majority (50% + 1)

8. © 2009 Vedder Price P.C. Employee Free Choice Act  Mandatory interest arbitration for first contract: Bargaining must begin within 10 days of request If an agreement isn’t reached on a first contract within 120 days, a government-appointed arbitrator is empowered to dictate the contract provisions, even in the absence of a showing of bad faith No appeal rights Contract will have 2-year term continued

9. © 2009 Vedder Price P.C. What Should Employers Do Now?  Update no-solicitation and no-distribution policies, and gain control of e-mail systems, bulletin boards, etc.  Conduct employee satisfaction/wage and benefit surveys  Educate management on union card signing and EFCA; ensure they know how to communicate lawfully  Confront and educate employees Use the “U” word?  Consider the size and configuration of appropriate unit

10. © 2009 Vedder Price P.C. Employment Non-Discrimination Act  Would amend Title VII to include sexual orientation and gender identity as protected personal characteristics  Currently, only 21 states’ EEO laws prohibit sexual orientation discrimination in the workplace, and only 12 states’ EEO laws prohibit gender identity discrimination in the workplace

11. © 2009 Vedder Price P.C. Arbitration Fairness Act  Would amend the Federal Arbitration Act to make pre- dispute arbitration agreements involving employment disputes unenforceable (except for arbitration provisions in collective bargaining agreements)

12. © 2009 Vedder Price P.C. Working Families Flexibility Act  Would permit employees to request (once every 12 months), and ensure that employers consider the request, for flexible terms and conditions of employment  Would give employees the right to request flexible work options related to: The number of hours they are required to work; The times when they are required to work; or Where they are required to work.  Employer would be obligated to meet with employee within 14 days of the request  Employer must provide a written decision within 14 days

13. © 2009 Vedder Price P.C. Working Families Flexibility Act  If employer denies request, the written decision must explain the grounds for the denial  If employee requests reconsideration, entire interactive process must be repeated  Employee can appeal employer’s decision to the U.S. Department of Labor  Bill has an anti-retaliation provision and would cover employers with at least 15 employees continued

14. © 2009 Vedder Price P.C. FOREWARN Act  Would extend WARN Act coverage to employers with at least 75 employees (rather than the current 100 employees)  A covered “plant closing” would be one affecting at least 25 employees (rather than the current 50)  A covered “mass layoff” would be one affecting at least 25 employees (rather than the current 33% amounting to at least 50 employees or 500 employees)  Would increase employer’s notice requirement to 90 days (rather than the current 60 days)  Would double the amount of back pay entitlement if the required notice is not provided

15. © 2009 Vedder Price P.C. Healthy Families Act  Employees would earn up to 7 paid sick days a year  Employees would accrue 1 hour of paid sick time for every 30 hours worked  Paid sick days could be used for employee’s own illness or medical condition, to obtain a medical diagnosis, a related treatment or preventive care  Paid sick days could also be used to care for a family member for any of these same reasons  Paid sick days could also be used to recover from or seek assistance related to domestic violence, stalking or sexual assault

16. © 2009 Vedder Price P.C. Family and Medical Leave Inclusion Act  Would amend the FMLA to permit leave to care for same-sex spouse, domestic partner, child of a domestic partner, parent-in- law, adult child, sibling or grandparent with a serious health condition

17. © 2009 Vedder Price P.C. FMLA Enhancement Act  Would amend the FMLA so that employers with at least 25 employees (rather than the current 50 employees) would be subject to the FMLA  Eligible employees would be entitled to take up to 24 hours per 12 month period of unpaid “Parental Involvement Leave” or “Family Wellness Leave”  “Parental Involvement Leave” would permit a parent or grandparent to take leave to participate in school or community activities that are related to their child or grandchild  “Family Wellness Leave” would permit an employee to take leave to tend to routine medical care, and to visit elderly relatives in nursing or group homes